An interesting fact about the metros are that the six metro markets of India namely Mumbai, Pune, Hyderabad, Chennai, NCR and Bengaluru accounts for 70 percent of residential apartment and home sales in India. A study and estimation of sales by a real estate market watcher firm stated in a report that out of these cities the condition in other cities except Bengaluru is such that it is most likely that they will register a 10 percent decrease in sales over last year’s figures. According to the study of the same organization it was estimated that a 4 percent decline can be expected in June with an estimated sale of 2.75 lakh units of sale of residential units but in practice the figures plummeted even more sharper which has really made the market upset. The market watchers and the experts also opine that although a gloomy picture of sales are being forecast but there is a slight optimistic note in the story as well. They have reported that Bengaluru is the only big Indian city with an estimated growth in the sales figures of up to 3 to 5 percent. It can expected that Bengaluru will have a sales of about 60, 000 residential units which was about 57, 000 in 2013 registering a growth of 3 to 5 percent.
Mumbai on the other hand is expected to experience a decline in sales by 10 percent which was projected at an estimated sale of 80, 000 residential units in June. NCR which was projected to plummet by 17 percent is now expected to decline by more than 20 percent.
In most of the cities the real estate market picture was bleak with the realtors expecting the sales to surge upwards as the enquiry was pouring in, in large numbers. The realtors expected the sales to surge upwards as the time between the enquiry and the sale in many cities were noted to decrease which is an indicator of elevation of buyers’ sentiments. This report was quite shocking for the real estate industry and Bengaluru being a stable market always returned 20 percent on investment on a steady basis, as noticed by the real estate market players.
The realtors feel that poor buyer’s sentiments and high prices are the reason for such a situation. Mumbai is witnessing huge price resistance which is evident from the fact that the enquiries have increased in numbers but the conversion of the enquiries to sales are still very poor. NCR is also witnessing similar situations but in Bengaluru things are on the brighter side. The realtors and observers say that in other cities the prices, interest rates and the economy are not in tune with buyer’s assessment of affordability but on the other hand Bengaluru goes ticking on because of affordable price threshold.
Hyderabad also witnesses similar situation due to which many developers are noted to tailor make their high priced apartments made for the higher segment and are catering to the upper middle and the middle segment.
The observers note that Bengaluru users are comfortable in the price range of Rs. 4, 000 – Rs. 6, 500 per sq. ft. in the middle to the premium segment. If the price goes higher than Rs. 6, 500 per sq. ft. the customers are noticed to be resistant.
