The festive season usually begins in September with Ganesh Chaturathi and includes the Navratras, Durga Puja, Diwali and leads up to Christmas and the New Year.
“Home sale price is at its minimium and there is no margin left for developers to offer freebies,” says RK Arora, chairman at Noida-based real estate firm Supertech, adding, “But we will surely see many new innovative payment plans.”
Vineet Relia, managing director of Gurgaon based firm SARE Homes, feels festive offers don’t work anymore. “Customers these days are looking for the right deal at the right time.”
Contrary to the general perception that a majority of sales happen in the second half of a year, during the festive season, a recent research by property consultantncy JLL India reveals that home absorption has been largely the same in both halves of the calendar year from 2010 to 2014.
A weighted average of the past five years shows that the first quarter attracts the highest number of deals at 27%, while the fourth quarter (i.e. the festive season) attracts 25%, which is at par with the average.
Marketing spends of real estate developers will see a 10-20% cut this year, according to Sandeep Ahuja, chief executive officer at Mumbai-based Richa Realtors. “Sales numbers in the festive months have not been satisfactory for the past two years, which has made developers cautious,” he says.
Niranjan Hiranandani, managing director, Hiranandani Communities explains that discounts and freebies just help in closing the deals faster and cannot be the real reason behind someone buying a flat. “People are looking at factors like quality, location, amenities, etc, these days, and will not be tempted by these offers or discounts,” he says.
But not all think the same.
Residential real estate is reeling under weak sales due to a severe liquidity crunch, unaffordable prices, high home loan rates and huge delivery delays. According to property consultancy Knight Frank India, over 7 lakh housing units remain unsold in eight major cities as of June 2015, which will take more than three years to sell the inventories at the current pace.