'Premium housing prices may fall soon on inventory pile up'
Nov 02, 2013
Source : The Economic Times

 

MUMBAI: Investorscan look forward to premium housing units getting cheaper by up to 20 per cent and gold prices rising significantly this festive season, says a financial advisory firm.

"We are expecting premium housing projects to get cheaper by up to 20 per cent... Potential buyers will not have to negotiate discounts, since realty companies are in all probability going to make such announcements," a Delhi-based financial advisory firm InvestCare said in a statement.

The high inventories can soon impact cash-flow for realtors, adding that depending on the project, a cut up to 20 per cent could be possible.

"A cut in prices is definitely possible for premium housing units. If companies can cut prices, it will help bring back buyers to the market despite the weak environment", its Managing Director Ajit Mishra said.

Company's director Samar Vijay said sales of premium housing units have fallen sharply and companies are sitting on huge inventories. Since premium units fetch huge margins to builders they can afford to offer discounts to get rid of the inventories, he adds.

The situation is very different from mass market units, he said, adding since builders have a lot more financial muscle they can hold on to the prevailing high prices. They are open to negotiated deals with potential buyers, which can help cut down price for the buyer, InvestCare said.

On gold prices, it said: "Gold prices could inch up after the compromise announced on the US government shutdown and the continuing uncertainty there. In the event of the debt ceiling being raised, the US Fed will have to print more dollars, pushing gold prices up further."

Since the US debt is rising and is likely to tread up further, we are confident that gold prices will go up substantially from current levels to around Rs 35,000 mark, he added.

 

 

Latest Realty News

SEBI cracks down on an illicit real estate scheme
Nov 02, 2013
MUMBAI: Market regulator SEBI on Friday barred Servehit Housing & Infrastructure India and its directors from raising money from public after a probe into mobilisation of funds by the company through alleged illicit real estate scheme.
Large office spaces see few takers as slowdown bites
Nov 01, 2013
MUMBAI: The quantum of large commercial space leased out dipped sharply last quarter. While Delhi saw a drop of 91% sequentially and 66% over the March quarter, the trend in Mumbai was only slightly better — the fall was 50% sequentially and 62% over the January-March period. Indeed, there seem to be few takers for office space of more than 1 lakh square feet — just 1.2 lakh sq ft was rented in Delhi in the September quarter while in Mumbai the area was 2.5 lakh sq ft.
Vastushodh Projects gets PE funding
Nov 01, 2013
PUNE: Mumbai-based PE fund Avenue Venture Partners Real Estate Fund has invested in one of the projects of Vastushodh Projects, a Pune-based developer of houses for the middle and lower income group.
Bombay HC finds Hirco arm prima facie loan defaulter
Nov 01, 2013
MUMBAI: The Bombay High Court has asked a subsidiary of real estate firm Hirco Plc to disclose all its assets in an interim order that observed that prima facie Hiranandani Palace Gardens has defaulted on loan repayment to Tata Capital Financial Services.
DLF profit falls 27%, hit by slowing home sales
Oct 31, 2013
MUMBAI: DLF LtdBSE -0.07 %, country's top real estate developer, posted a 27 per cent fall in its consolidated net profit for the July-September quarter, hit by slowing home sales in Asia's third-largest economy.
Equinox appoints C&W as marketing partner
Oct 31, 2013
PUNE: Equinox Realty, the real estate arm of Essar Group, has appointed property services consulting firm Cushman and Wakefield (C&W) as an exclusive marketing partner for its 'Villas in the Sky' range of apartments at Water’s Edge in Hebbal, Bangalore.
Godrej Properties reports 5% rise in Q2 profit
Oct 31, 2013
MUMBAI: Godrej Properties, the real estate arm of the Godrej Group, has posted a net profit of Rs 34.25 crore for the second quarter ended September 30. This was 5 per cent up from Rs 32.58 crore posted in the year-ago period.
Pune based Vastushodh projects affordable housing gets a PE Boost
Oct 31, 2013
PUNE: City based Vastushodh Projects is all set to get a boost in its endeavour to provide housing for middle and lower income groups with Avenue Venture Partners, a Mumbai based PE Fund taking project level equity in some of its projects.
Housing projects may face more delays ahead
Oct 31, 2013
MUMBAI: Delayed housing projects have become common in India—a recent study said one-fourth of all residential projects in the country are delayed—and the problem is likely to get a lot worse going by the sheer number of apartments scheduled for delivery till 2016.
RBI hikes rate, but your EMIs unlikely to go up
Oct 30, 2013
MUMBAI: Reserve Bank of India governor Raghuram Rajan on 29th October stepped up the inflation control drive by raising a key policy rate but the increase is unlikely to impact interest rates for home, car and consumer loans.

Latest Realty News Of State

Realty Talk's