The lull in sales in the last few months appears to have provided time for the industry to introspect, as a result of which the focus now turns on affordable housing.
Has reality finally dawned on the realty sector? Has the boom, which most described as unscientific and without proper foundations, come down crumbling and the construction industry woken up to the needs of a vast middle class housing needs?
Last couple of months have started showing signs of the industry making a slow and steady shift towards the actual demand and in the process prices too have begun to appear climbing down from high on the ladder which they went on to occupy. The trend is changing and more appealing options are proffered by builders but perhaps still more is what the customers, conscious of their budgets now, are waiting for.
Some of the leading construction companies have come out with affordable housing and most in the industry appear contented that these offerings will infuse fresh lease of life for the real estate. The availability of stocks in the market is going up without a commensurate rise in client base; some are just waiting to get finished while those in pipeline are on hold for some good tidings.
A builder observes that offers such as assured rental till possession and marginal cut in prices of properties did create ripples of interest in an otherwise placid market. Some such as Aparna Construction, Janapriya and Prajay have initiated a process and the rest need to join in with more ideas to sustain the tempo, he feels. The week also saw Obili Infrastructure making news with offers of flats ranging from Rs.4 lakh onwards.
Are villas and super luxury apartments out of demand now? The whole thing went awry, another leading builder points out, when the industry forgot that such housing is demanded by only a small segment. “Because of high paying IT jobs, few more buyers came into the market looking for such housing and our people mistook it,” he says. Instead of catering to that slice of customers with what they want while not losing focus on the larger market demand, every builder tried to rush in for high-end luxury construction.
The argument is that villas and dwellings spread over acres and apartment with helipad will be lapped up by those who can afford. “The question is how many actually can ?” he asks. The actual demand for housing stock with Italian marble flooring, imported taps and Jacuzzi should be understood by the industry and creating more stock than needed was bound to be a sure recipe for disaster.
The lull in sales in last few months appears to have provided time for the industry to introspect and the result seems to be increasing focus on affordable housing. Recent developments are sure to bring down land prices too and with builder having less to pay for land, coupled with marginal corrections in prices of construction material, a revival of interest in real estate is possible in the days to come.