Flats in Chennai for saleare still going through tough times as sellers are not finding them easy to liquidate. The unsold inventory in Chennai property market is at record high and the figures are only marginally better as compared to other prominent cities of India. The countrywide backlog stands at multi-billion dollar.
The developers in the southern city of Tamil Nadu are trying several tricks to offload the rising hangover and are coming up with several kinds of discount including:
- Free gold coins on booking
- Entry level hatch back car on paying the 20% down payment
- Foreign trips for the family of 3 to 4 people on booking the flats at launch or under construction stage
- Various finance schemes such as 5:90:5, which means 5% upfront payment, 90% money through loan and remaining 5% to be paid on possession
- Discounts of up to 200 to 300 rupees per square feet on market rate
- No registration, stamp duty, service or VAT on flat purchase, etc.
However, none of these seem to be working as of now for offline sales. The reasons are plenty. And amongst them the prominent ones include high property prices. In Chennai alone, the real estate prices in most places across the city have more than doubled in the last 5 years and even though the backlog is increasing, the developers continue to escalate the cost of flats,each quarter and sometimes even monthly. Hence, discounts of few hundred rupees actually make no sense to prospective home buyers. Other than this, the rising property frauds, inaction by the previous regime, lack of reform measures, higher income rates and stagnant salaries during the recession years have also played their role. All of these factors collectively have meant that the flats in Chennai for sale cannot be taken off the shelf easily. Here is a look at the current inventory situation in this city –
Approximately 7 quarters of backlog
As per the data from the leading consultants, it took more than 4 years for the developers in India to cash their assets.But the rise of online real estate web portals like Housing.com has salvaged the situation to a large extent. This is because a site like Housing.com has brought in the much needed transparency and clearness in the property sector, increased the retail participation, gave the common men, builders and developers a joint platform to buy, sell and rent their assets and ensured price rationalization. As a result, the unsold inventory in Chennai now stands at 7 quarters, which is a tad more than 6 quarters, regarded as the healthy signs for realty industry.
New launches and offline sales have fallen
The constant slowdown that existed in the property sector over the last few years has led to fall of new launches and offline sales across the country. The number of new projects being launched in Chennai has fallen by 25% and the sales have declined by 10% year on year. Nonetheless, with realty e-commerce picking up, and property sites like Housing.com making their presence felt across the spectrum, the sales numbers are expected to increase in the coming quarters.