Hyderabad Real Estate on the Verge of Correction
According to data released by Anarock Property Consultants, the builders are sitting on an unsold inventory of 58,535 units as of September 30. The inventory on June 30 was 50,580 units. While nearly 8,000 units were added to the market between July to September, the real estate sector managed to sell only 6,735 units in this period, leading to an oversupply in the market. “Hyderabad turned out to be the only city in India with the highest increase in the available inventory with nearly 58,535 units available for sale. Furthermore, a sharp rise in the new supply over the past few quarters has increased the city’s available inventory by 113 per cent compared to the same period in the previous year,” said Prashant Thakur, director, Anarock Property Consultants. The pre-launch sale concept has brought an already over-supplied Hyderabad real estate market on the verge of a correction, says C. Shekar Reddy, the Past National President of Credai. Shekhar Reddy says the pre-launch sale concept violates the Real Estate Regulatory Authority regulations. “The moment the buyers purchase the land and enter into a development agreement with the builder, they would be liable to those buying the flats later on. But many people get into this trap unaware of the legal complications,” he explains. Apart from the open auction of land parcels by the government, the prelaunch sale concept is also responsible for a spurt in property prices in the city. One of the arguments against the builders resorting to pre-launch sale arrangements is that they were not negotiating hard with the landlord. Though the price correction could happen in the Hyderabad market. In Hyderabad, the companies without any previous record are opting for a pre-launch sale model. But if they go bankrupt or leave the unviable project, the buyers would have no recourse and they cannot do much with the undivided land,” he explained.
Tags : News/Views Builders Hyderabad CREDAI RERA ANAROCK unsold inventory Land Parcels Undivided Land PreLaunch Sale Model