Folly to raise home prices now: Realtors | zameensantosh's Blog

IT will be a mistake to raise prices of homes now anticipating festive season demand and because of a fall in new project launches, since the revival of consumer interest may be fragile, some builders say.

“It is not very wise to increase prices drastically now,’’ said Niranjan Hiranandani, managing director, Hiranandani Group, one of the Mumbai’s biggest real estate developers. ``The market has just recovered and the buyers are returning.”

According to developer sources, home prices have risen about 15% In tier-1 cities, particularly in Mumbai and the national capital region (NCR) over the past 2-3 months anticipating a pick up in demand due to low interest rates after falling in the prior 12 months due to the credit crisis. The curtailment of supply due to a 45% in fall in new projects in tier-1 cities has also improved the prospects of higher prices.

“We have sold around 2.5 million sq ft in last quarter and are expecting to sell over 1.5 million sq ft during the last quarter of 2009,’’ said Abhisheck Lodha, director, Lodha Developers,. ``Normally, the festive season is when there are a lot of bookings in the sector.” There is a possibility of lower prices too. “Many developers who have to maintain cash flows could either reduce prices or come out with freebies,’’ Sandeep Shah, managing director, HBS Realtors, a Mumbai based realty firm.

Courtesy:- ET dt:- 21-09-09