The 2019 festive season has started, and many non-resident Indians (NRIs) aspire to buy homes during a period that is both auspicious and invariably also sweetened with offers from developers.
Since the festive season is considered very auspicious for the purchase of property, close to 30-40 per cent of yearly sales is generated during this short period itself. Hit by the prolonged slowdown in the real estate market, Indian property developers are betting big on the current festive season for revival of their fortunes.
Developers say that a large chunk of enquires come from NRI customers visiting their native land during festivals. Most of the NRI customers choose these festival holidays to finalise pre-selected projects. Thus, this is one of the major reasons which propel the sales figures in this festive quarter.
Anuj Puri, chairman of Anarock Group, said: "Good projects, good developers and right prices are factors that will ensure sales in attractive locations. With returning demand, we can expect the natural laws of the market to manifest and prices to begin firming up in the good projects. The festive season of 2019 had also coincided with various government incentives to ensure improved demand over the same period last year."
Reputed developers are garnering good sales as buyers too are looking for either Rera-compliant good quality projects from reputed developers or projects that are ready to move in. Most developers have even scaled up their marketing spend to boost sales during festive season.
Sarojini Ahuja, vice-president, sales and marketing at Transcon Triumph, said: "Any developer goes for 360-degree marketing for the launch of the project to sell maximum inventory. Gradually, the budget reduces according to the needs and is spent during the festive season to boost sales. During the last leg of the project, again the marketing activities are reactivated for the closure of sales."
"We spend around 0.5 per cent of the project cost on marketing every year. Every year we spend the same budget on marketing... we spend around 15 per cent of our total marketing budget for the GCC market targeting the NRI community," he added.
The Modi government's slew of measures to boost housing demand is expected to result in housing sales increasing by between 5-7 per cent in the festive season, said Anarock Research in a report. Real estate developers are expecting an upward surge and steady increase in sales this festive season; backed by a slew of reforms the finance ministry has announced recently. Developers say reforms, including increased liquidity and creation of stress asset funds will help in reviving buyers' sentiments.
"The sentiment in Mumbai has definitely improved in the past few months. The number of enquiries and bookings has gone up in our projects, and we expect the market to remain positive in the upcoming quarters," said Subodh Runwal, director of Runwal Group.
"NRIs, service professionals, and the business class are already driving the real estate demand in this micro-market."
Every year, the real estate sector witnesses positive sentiments flowing in the market during these auspicious times. Residential real estate is seeing some revival in buyer's sentiment. Rapid urbanisation, FDI in real estate, improving economic reforms, ease of doing business and increasing transparency in policies have been augmenting NRI investments.
New launches have improved in the last couple of quarters. Many micro-markets have seen new launches and overall, and there is an upsurge in sales compared to previous quarters.
"Many developers will be offering attractive deals, but a buyer should keep in mind the reputation of the developer, its past track record and other factors like connectivity, accessibility, amenities and various principles of design that the developer is offering while buying a property. The policy reforms and developments will have a cumulative positive impact on the overall sector and help build long and trusting relationships between the developer and the buyer," said Bhasker Jain, head of sales, marketing and CRM at The Wadhwa Group.
In the current scenario, there are a number of developers offering easy financing schemes and festive discounts. Positive consumer sentiment, backed by various reformatory changes, is helping the real estate market stay afloat.
Deepak Nair, head of marketing at JP Infra Mumbai, said: "Traditionally for real estate, the festive season fares better than the rest of the year especially for home buyers... these ready-to-move-in properties are seen as an excellent value proposition for discerning home buyers as they get to feel the actual apartment that they intend to buy and helps mitigate risks associated with new projects that include incessant delays. Also, these homes do not attract GST, which is the biggest benefit for home buyers."
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