After a significant decline in the rates of flat and apartments, the city land rates are also witnessing a sharp fall, by almost 20%. If the downfall trend will continue, then the property prices will dip further.
Pankaj Kapoor, managing director of real-estate research firm Liases Foras, said plots being sold nowadays are going at moderate rates, as compared to earlier times when the realty market was more speculative. “Given that high land cost is the major culprit in raising the flat prices and in making affording housing projects impossible for the common man, their slipping will imply that the flat rates will automatically come down,” he said.
Stating that most buyers could not afford to pay the till-now prevalent roof-high flat and land prices, Kapoor welcomed the fall in land prices. “In fact, if the new Development Control (DC) rule gets adopted in the Navi Mumbai and Thane area, then it is likely that land prices will take yet another beating, with all the ornamental features like super built-up area will fade away,” he added.
However, Kapoor refrained from terming the recent sale of City and Industrial Development Corporation ( Cidco)’s six plot at Ghansoli on January 10, 2012 as a cheap deal by any standards. Subsequently, on January 13, Cidco netted Rs 70 crore by selling three more prime plots at Kharghar.
The reducing land prices has also brought cheer from developers too. Manohar Shroff, secretary, Maharashtra Chambers of Housing Industry, Navi Mumbai, said plot holders are expected to climb down from the astronomical land prices prevalent until recently.
“Earlier, there were huge demand for plots in Navi Mumbai, but now that demand has dried up drastically despite the airport project gathering steam. No longer will you find big land transactions taking place, with developers becoming cautious of buying plots at high rates, as it can put them in financial trouble. Compared with the earlier property rates, the present rates have come down by almost 20 percent,” he said.
Atul Nemade of the Sai Joyti Infra project, a realty brokerage firm, said the high interest rate and the market slowdown had adversely affected sale of plots. “While earlier developers were eager to buy large tracts of land, they seem more reluctant now, thereby resulting in fewer huge transactions,” he said.