Correction nearing? 5 lakh homes ready for delivery this year

The housing sector is likely to get a boost as nearly five lakh homes will be ready for possession this year, the highest in a single year and double of what was delivered last year, an Economic Times report pointed out today, citing surveys by property research firms.

The dearth of ready-to-move-in flats is what had led to speculative pricing, driving up property prices in India. Hence, the deliveries are likely to lead to a price correction in both under-construction and ready flats where a lot of new supply is concentrated.

In a sluggish real estate market, where home sales have slowed down and private equity has dried up, the delivery of homes will not only help builders bridge the liquidity gap but also allow them to finance other new projects.

More from Economy

Inflation likely to be a big focus area for budget 2024, say sources Explained: Will the Bank of Japan break tradition and raise interest rates?

[caption id=“attachment_608370” align=“alignleft” width=“380”] Reuters[/caption]

A bulk of the new homes, the deliveries of which were delayed due to regulatory hurdles, liquidity crunch and farmer agitation, will come up in Noida, Greater Noida, Gurgaon in the NCR region (1,41,921 units) and Thane and Navi Mumbai in the Mumbai Metropolitan Region ( 1,21,992), followed by Pune (62,000), Bangalore (58,000), Chennai (51,000), Hyderabad (38,659), Ahmedabad (24,400) and Kolkata (18,248).

“Price points are already too high in many markets, and investors who will get their apartments this year might not have any option but to offer some discounts to exit,” Pankaj Kapoor, managing director of Liases Foras, was quoted as saying in the report.