KOLKATA: While tepid demand and a pile up of inventory slowed down launches of real estate projects in the city by 30%, it has paved the way for higher interest in luxury properties whose prices, too, have been reducing.
Properties on high streets, like Ballygunge and New Alipore, are now priced between Rs 18,000 and Rs 20,000 per sq. ft. compared to Rs 25,000 per sq. ft. (approximately) quoted in September-October 2016.
“A lot of inventory in the luxury housing segment priced at a ticket price of Rs 1.5 crore and above were lying unsold for over two years. Demonetisation further slowed down the market. Thanks to the new move, prices of several projects are seeing a discount between 10 to 15%,” said Champalall Baid, Director of city-based real estate firm Champalall and Co. About 50 units in the Rs 1.5 crore and above category were sold in the last three months, Baid said. Prices of projects on Burdwan Road, Rajarhat and southern fringes of EM Bypass have also seen a price cut.
“Though the reduction might not seem very significant, for luxury projects which are generally more than 2,000 sq ft, the 10% discount per sq ft results in a prices going down by a few lakhs,” added Baid.
“Projects whose share of sold units stood at 40% now stands at 60%,” said Baid.
The market in Kolkata is recovering from the demonetisation-induced lull. “Queries have gone up by 100% and are also resulting in purchases. Launches that had taken a hit in the last calendar year will also show improvement with inventory in the luxury segment being sold off,” said Nandu Belani, president of CREDAI Bengal.
A research on the performance of the sector in July-December 2016 by international consultants Knight Frank revealed that the city showed a spike in sales in the first half and a dip in the second half. Among the flats sold in the year, 70% were in Rajarhat and the Garia-Narendrapur Baruipur belt in the south Kolkata areas, mostly comprising affordable and mid-level projects.
“From 5,784 units sold in April-June 2015, sales crashed to 3,413 units in October-December 2016. But we see the situation changing with fiscal prudence in the budget and the economy accommodating demonetisation steadily. Launches of more projects towards mid-year can also be expected,” said Knight Frank chief economist and national director Samantak Das.
Source: Economic Times