The big shift in realty
What's bad news for developers is turning out to be good news for home buyers
Realtors haven't had it quite this bad until now. They were the untouchables with money and political clout, who had home buyers at their mercy. This is changing.
In the North, a leading developer recently was at the receiving end of consumer activism with a strong lawsuit. Down South, a reputed builder is being threatened with disposal of its assets by creditors looking to recover their dues. The Government too is tightening the screws with a regulator in the wings. Real estate development is unlikely to be what it used to be.
What's bad news for developers is turning out to be good news for home buyers and home owners. Reports indicate that even the 'affordable homes' category hasn't seen much sale in the recent past. A climate of uncertainty shrouds the global economy and financial markets, and this is telling on the realty sector. Prospective home buyers are awaiting a further dip in prices, and the high inventory with developers isn't helping prices either.
What is also notable about the recent activity in the sector is that the volumes are more in the second rung cities and smaller towns, as well as in secondary transactions — between individual home buyers and sellers. This is also, perhaps, because over the past 8-10 months there had emerged a wide divergence between rates of secondary market properties and new developments — which were being priced at a significant premium by developers. That correction is now bound to happen, as, rationally, completed and ready-to-move-in homes should command a premium.
The transactional shift is bound to have a telling impact on developers' ability to dictate terms in the market. Their control is likely to diminish and the oligopolistic structure of the past is likely to make way for a more demand-and-supply driven market. That's a good tiding in 2016 for home buyers. Finally, the buyer is emerging as the king in realty.
The big shift in realty - The Hindu
