Sales up, but realtors not upbeat

Despite more than 1.35 lakh sales deed registrations in the last financial year, realtors believe this growth hardly reflects the current market trend. Contrary to the current real estate

trend, sales deed registrations have gone up 13.5%. However, real estate developers and consultants in the city do not seem very optimistic about an upbeat market movement in future. They

believe the sales deed registration growth hardly reflects the current market trend, with the only exception being re-sale property deals and ready possession properties. The city witnessed

over 1.35 sales deed registrations of residential, commercial and industrial properties as well as land in 2012-13, as against around 1.19 lakh registered in 2011-12. This means that 13.5%

more properties changed hands in the last financial year over the previous year. However, this growth has been slower than during 2010-11, when it grew by 17% over 2009-10. Similarly, the

state government’s income towards stamp duty from the city grew by 12% in 2012-13.The state government earned Rs994.37 crore towards stamp duty charges from property deals in the last

financial year, compared to Rs887.04 crore in 2011-12. Real estate developers and consultants, though, believe that the figures of sales deed registration do not reflect the current market

situation. Sales deed registration takes place at the time of possession of properties. This means that properties sold in new residential schemes launched around 12 to 18 months back are

getting reflected in government records now. Moreover, it shows movement of the re-sale and ready possession properties market, which is governed by real users and not investors. Meanwhile,

developers and consultants believe that market is sluggish and unlikely to witness major movement in the near future. “Real estate is witnessing slow movement with a normal growth rate of

around 10-12%. The previously seen growth rate of 30-35% is not possible now,” said Dinesh Patel, chairman of Confederation of Real Estate Developers Associations of India (Credai), Gujarat.

  President of Ahmedabad Realtors Association Pravin Bavadiya said that investors have not been able to exit the market, so its movement is dependent on end-users only. “I do not think the

market will break out of its bearish trend for another year and a half,” he said, before adding that serious buyers have an opportunity to haggle on prices in the current market scenario.

However, Credai national vice-president, Jaxay Shah believes that market will be out its sluggish trend in soon. “Foreign institutional investors (FIIs) are looking forward to investing in

the Gujarat real estate market. They are just waiting for the right moment. Generally, they invest when bearish trend is about to end,” Shah explained. Developers also believe that projects

with affordable price tags and better amenities are preferred by end users, at the moment.