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| What next? |
| 03.08.09 (11:22 pm) [edit] |
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With the current financial constraints of the
developers and no support coming in from the interim budget, the builders will be
better
off focusing on the core fundamentals of good real estate development
that concentrates on space efficient apartments with respectable
finishes and cost-effective amenities for the middle class buyers.
As for the buyers, they are better off starting their apartment search
today by negotiating hard with reputed developers to get the maximum
space with upgrades at the minimum price per square feet and ink the
deal, says Amit Ramani, President, Nelson India.
Long horizon
Yet another view is that the lack of sops will build up pressure that
will lubricate demand and supply in such a manner that down the line,
things are bound to fall in place. Simply put, the next six months will
be critical.
According to Harsh Vardhan Roongta, CEO of apnaloan.com, the revenue
deficit numbers tell the true story The money . markets are clearly
recognizing the stress. Obviously reducing interest rates to stimulate
demand is clearly not going to be easy in such a situation. In fact,
interest rates have reduced only marginally and have stubbornly held on
despite the massive dose of liquidity that has been injected in the
system over the last two-three months.
So what does it mean for the residential real
estate sector? “I think
as the holding capacity of the developers reduces, we will start
seeing reduction in prices across the board sometime around May June
when the lean season anyway begins even in normal times. The consumer
should pick up the signals after a short time lag and we may see the
OND quarter to be a pretty good quarter in terms of consumer demand.
Of course, it all depends on how the economy rolls out and whether the
good show put up by the agricultural sector will continue this year as
well. The government (both current and
to-be formed) can kick-start
this process by at least removing the regulatory cost (in fact it
should be called a tax) on land that adds up to anywhere up to 30-40
per cent of the land cost. Since this cost is mostly added at the
state government and local bodies' level this will require an
across-the-board consensus of the kind that has been achieved on VAT
and GST. A tough ask but in the extraordinary situation currently
prevailing, it is possible if guided with some degree of imagination
and fiscal incentives.”
Courtesy:- HT dtd:- 21-0
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