Even as the current sentiment remains sluggish, industry experts believe the real estate sector is likely to see some improvement in the next six months when property prices will also witness upward movement.
"As
per the stakeholder survey, not just supply and demand for residential
property, but price too is expected to witness an upward movement in the
next six months," Knight Frank India Chief Economist and
Director-Research Samantak Das said in New Delhi.
He was talking
to reporters after releasing a report on 'Real estate sentiment index',
jointly brought out by FICCI and Knight Frank India, a real estate
consultancy.
However, if an analogy is drawn with the 2009 general
election period, the determinants of housing demand are strikingly
different this time around, Das said.
"Property prices have risen
faster than the growth in household income or general inflation during
this period. Interest rates are much higher. Lack of any meaningful
improvement in determinants of housing demand, according to us, means
the situation will remain the same."
A majority of respondents
surveyed for the report were positive on economic front and expect an
improvement in the next six months.
Stakeholders feel the realty
market has deteriorated compared to the last six months and the current
sentiments are pessimistic across all zones. However, east and south
zones remain marginally more optimistic about near future compared to
the rest, the report said.
"Compared to the previous two quarters,
sentiment levels of the industry have deteriorated in the current
quarter and they are pessimistic across zones, barring the east and
south.
"A greater focus on driving economic activity and
streamlining regulatory processes, will help build both business and
consumer confidence," FICCI Real Estate Committee Chairperson and
Mahindra Lifespaces Managing Director and CEO Anita Arjundas said.
The
report pointed out that while there is an evident optimism for the
residential sector, the office market is expected to remain depressed in
the coming two quarters.
"Notwithstanding the economic risks
associated with the impending general election, stakeholders expect an
economic expansion during the next six months," Knight Frank India
Chairman and MD Shishir Baijal said.
Source:WEB