The real estate sector isin a bad shape in thecountry. Manybuilders say this is

mainly on account of the un-certainty in the current extend-ed season of general election inthe country.

A major Gurgaon-basedbuilder, who does not wish to benamed, says that the sector ishoping for some stability in thecentre—which would enablethe much-needed reforms inthe real estate industry to flowin—and support, in the form ofminimum infrastructural de-velopment, so that projects canbe completed on time.

He says the sector would notbe much affected by the ideo-logical bent of the new party insaddle at the centre after thegeneral election, as long as thegovernment is stable and deliv-ers on the ground.

Prices of property in the sec-ondary markets have fallensubstantially. In some cases,they have fallen by up to 20%.

The number of transactionshas also declined substantiallydespite special schemes fromdevelopers like 20% of the totalamount to be paid at the time of bookings and the rest at delivery. Sales are just not pick-ing up.

Another Noida-based largedeveloper said there is a hugeuncertainty in the market dueto the slowdown in economy.This, he said, has raised appre-hensions of layoffs and a re-sultant wariness of thesalaried class in risking invest-ment in the property market,which would create a huge liability in loan repayment incase of job loss.

In this condition, developersfeel that the election result willplay a major role in reviving

the sentiment. All the buildersfeel that a stable governmentwould help in reviving the pres-ent depressed mood in the econ-omy, which in turn would liftthe fortunes of the real estatetoo. They also hold out the re-verse scenario, where a highgrowth in real estate sectorwould help the country in im-proving its overall economy.

However, consultants saythat the real estate sector willcontinue to grow in this coun-try as there is a huge unmethousing requirement in urbanIndia. While the hope of highgrowth may be affected depend-ing on the combination ofparties that form the govern-ment, the overall growth wouldcontinue in the sector never-theless.

If the economy improves, thedemand for housing would alsogrow. But, if the governmentdoes not provide the requisitesupport to the sector, the sup-ply of housing units may be af-fected. In that condition, thegap between demand and sup-ply would widen, resulting ingalloping prices of property.

Consultants say that thepresent slowdown in the realestate sector is temporary, espe-cially in the NCR region, whereactivities will pick up as soonas the election result is out.

Buyers will come back to themarket even on the strength ofthe smallest whiff of activity,the consultants say.

Many experts say that priceswill also go up irrespective ofwho forms the government. If anon-performing governmentcomes at the centre, priceswould increase as the slow-down in the construction activ-ities would persist resulting inwidening the gap between de-mand and supply. And if aproactive government were tocome in, the general mood

would improve across the econ-omy, pushing the prices uponce again, a developer said.

The fact remains that anygovernment can use the sec-tor to revive the economy ofthe country. The PHD Cham-ber and real estate consultancyfirm Cushman and Wakefieldin a report said that India’s ur-banization is a subject of glob-al interest and can attract bil-lions of dollars in investment.

According to the PlanningCommission, urban India is go-ing to be home to 600 million

people by 2031—an increase of59% from the 2011 level of 377million people.

While on the one hand thisposes a huge challenge to oururban planners and developercommunities, the situation alsooffers big opportunities. If thecountry as a whole rises up tomeet this gigantic challenge, itwill lead to the creation of mil-lions of jobs—creating hugewealth at the same time.

It is well known how urban-ization boosts industries liketransportation, communica-

R E S I D E N T I A L A P T S : D E L H I / N C R

property index

LOCALITY PRICE RANGE /Sq FEET

Chittaranjan Park 14450 to 18750

Defence Colony 28700 to 36900

Greater Kailash II 18500 to 23900

Panchsheel Enclave 21200 to 27800

Panchshila Park 20700 to 27650

Golf Course Road 12050 to 14400

Gurgaon-Faridabad Road 7400 to 9000

Sohna Road 7650 to 9850

Sector-50 7300 to 8850

Sector-61 7050 to 8100

Sector-92 7200 to 8100

Sector-93A 6650 to 8700

G U R G A O N

N O I D A

QUICKBITES

�

CONSULTANTSSAY THAT THEPRESENTSLOWDOWN INTHE REALESTATESECTOR ISTEMPORARY,ESPECIALLY INTHE NCRREGION,WHEREACTIVITIESWILL PICK UPAS SOON ASTHE ELECTIONRESULT IS OUT

The real estate sector has pinned its hopeson a stable government after the generalelection, which, at the least, would end

the uncertainty that has stymied the market in the past several months.

PRABHAKAR SINHA writes

tion, food processing, health-care, education, etc. The jointreport keeps this reality inperspective while arguingthat this whole process pres-ents lucrative opportunitiesfor immense investments.

However, to expedite thereal estate activities to meetthe urbanization require-ment, the report says that thenew government must createan environment where thewhole system can function ef-ficiently, so that the cost offunding real estate projectscan be brought down. It saysrapid development will pro-vide higher returns to in-vestors than investmentmade in developed countries.But, in order to attract in-vestments, “higher efficien-cies” must be built into theprocess of urbanization.

The report praised theManmohan Singh govern-

ment for launching the Jawa-harlal Nehru Urban RenewalMission (JNNURM). Accord-ing to the March 2012 datafrom the ministry of urbandevelopment, the JNNURMhas approved projects worth$11.2 billion. But, the reportquestioned the efficacy of thewhole process. It said policiesand plans must be supportedby sound execution.

But developers feel that ur-banization is still not on thepriority list of most of the po-litical parties. In fact, the realestate sector is still consid-ered by many as a sectorwhich thrives only on blackmoney. Premier developers’bodies like Credai and Nared-co have long demanded that aregulator should be formedfor the sector, which wouldmonitor the industry andsafeguard all the stakehold-ers’ interests.

Delhi April 26, 2014

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