Pre-festive season slackness seep into real estate registrations
Sales registrations slipping below the 5000 mark for second consecutive month
No near-term respite in the absence of a fiscal consolidation program
Weakness in commercial real estate result in sharp decline in lease registrations
Challenges remain despite volume stabilization
The 5000+ mark for sales registrations, which was held up for the March-May
period, had given way in June and is further slipping with another 2% decline
witnessed in the month of July. The pent-up demand which was witnessed earlier
seems to be subsiding once again, given the slack period prior to the festive season.
The trailing 3-month registration chart, which had witnessed a slight break in the
falling trend, has once again embarked on its descending journey.
In this scenario of high interest rates and inflationary pressures without a strong
fiscal consolidation program on part of the government, we do not expect a nearterm
respite for the sector. With developers sitting on highly leveraged balance
sheets, a price cut becomes inevitable. We believe that the challenges to the sales
scenario in the city continue to remain high and the stressed affordability equation
needs to be corrected by a number of factors amid high property prices. Thus, we
maintain our cautious stance on the city’s realty scenario.
Lease registrations, which have been clocking new highs for the last several months,
have been severely impacted with a slowdown in commercial real estate. Lease
registrations for the month of July were down 17% on a MoM basis.
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