The home lovers who all want to settle down this year have to wait a bit longer. Surveys show that in 2013, developers on an average would be delivering one third or even less number of units committed this year.
The National Capital region is being performing very badly among the other cities. Data shows only 24 pc of units have been delivered until September this year. More than 25 pc committed supply has not been delivered. The market condition in Southern part of India is far better than the Northern part the survey showed.
In Gurgaon the market hit ratio is one third while in Noida region is below 20 pc. Pune and Mumbai are far ahead in delivering, 40 pc of committed supply this year.
Most buyers have budgets for delay of a few months for some genuine problems faced by eth developer. But this time around the developers are facing many problems some are being created by the developer and some are out of their control.
The factors which are delaying the developer can be assume as shortage of capital, equity firms are worried about 80:20 schemes introduced by RBI. The next one can be over-leveraging, as many developers had burrowed money to but land but due to the slowdown and the interest rates going high which suck most of the cash flow of the developer and have nothing left for the construction. The third might be the availability of land and the fourth can be inadequate approvals when required have not been taken from the respective bodies.
There are some more reasons also like the increase in land prices with increasing in input cost and the currency depreciation can be some more factors for slowdown in delivering.
When the house is not delivered on promised date there are additional cost the buyer has to bear. The EMI payment that goes any way and the additional expenses unit the unit is delivered.
The consumption in the local market is very essential for the real estate market to grow as most of the housing requirement is local or in near by areas. Large project sin small towns are facing hurdles due to slow movement of inventory.
The resale market is a good prospect in these conditions, especially if the purchase is geared towards end-use. The current slowdown in demand and high interest rate has also hit investors hard. The only participant in the market are the end-use buyers, for them situation looks promising.