Past prices perfect for now
The Hindu Business Line, April 5, 2009, Page 15
--------------------------------------------------------------------------------
Overwhelming response to HDIL offer for Mumbai projects.
--------------------------------------------------------------------------------
— Paul Noronha
The pricing looks very attractive for home-seekers in Mumbai.
S. Shanker
Could residential demand pick up if prices are rolled back to levels prevalent a few years back?
Yes, seems to be the answer going by the experience of one of the largest developers in Mumbai — Housing Development and Infrastructure Ltd (HDIL).
Property buyers in Mumbai appear to be looking for 2004 prices in the current economic scenario, going by the responses that HDIL got last fortnight.
One of the large-scale real estate developers in Mumbai, HDIL has executed 32 projects spanning over 28 million sq.ft of saleable area, besides four million sq.ft under slum rehabilitation schemes in the city since 1996.
Primarily into residential housing, HDIL priced its March launches, comprising one- and two-BHK (bedroom-hall-kitchen) apartments at Kurla, a central suburb in the city, at Rs 5,251 a sq.ft — a level of pricing that prevailed there in 2004. The response has been overwhelming and the company, which opened bookings on March 6, has sold over 85 per cent of the 756 apartments till date.
Even in the present market conditions, where builders have lowered rates across the city, the Kurla project appears to be at least 30 per cent lower than the prevailing rates in the locality.
The second project of 413 apartments at Andheri, an upmarket locality close to the airport, too garnered good response so much so that the company has raised the price from Rs 7,651 a sq.ft to Rs 7,951 a sq.ft.
“We were looking for first-time buyers, who were pushed to the sidelines over the last three-four years and who form a sizable population of the working class in Mumbai,” says Mr Hariprakash Pandey, Deputy General Manager - Finance, HDIL.
Referring to the Kurla project, Mr Pandey says the offering of one and two BHK in the range of Rs 50 lakh fitted the bill of the middle and upper-middle classes who are willing to pay that much more for a central location with good road and rail connectivity, besides other infrastructure. “Many of our buyers told us that they had gone in for no more than a Rs 30 lakh loan by bringing in the balance as margin money,” he said.
The Andheri property too has its advantages, though the company managed to leverage on the prevailing rentals at the locale to arrive at the price point. With two BHK rentals at Rs 50,000-60,000 and buyers known to correlate rentals to the equated monthly instalments of bank loans, the pricing was seemingly attractive. “More importantly, there is no fresh supply coming in at the moment in the locality and the price is close to 40 per cent lower than the 2007 prices,” says Mr Pandey.
HDIL has lined up two more such launches in the coming months, where the price band would look overtly competitive to home-seekers.
Opts out of Dharavi
HDIL has pulled out of the Rs 15,000-crore Dharavi Redevelopment Project and may instead look for contracts from the bid winners.
Mr Pandey said the contract had become unviable and there was a great deal of uncertainty over the biding process. Further, there was no clarity in execution — how much space would have to be provided to the slum dwellers — 269 sq.ft or 400 sq.ft, besides the issue of premium the government sought for the slum resettlement project.
In 2007, the company was awarded the Mumbai international airport slum rehabilitation project as part of the Mumbai airport expansion project, which involves resettling 85,000 slum families by 2012.
Under phase I, HDIL plans to resettle 20,000 slum families on 38 acres at a cost of Rs 3,200 crore by December.
The Hindu Business Line, April 5, 2009, Page 15
--------------------------------------------------------------------------------
Overwhelming response to HDIL offer for Mumbai projects.
--------------------------------------------------------------------------------
— Paul Noronha
The pricing looks very attractive for home-seekers in Mumbai.
S. Shanker
Could residential demand pick up if prices are rolled back to levels prevalent a few years back?
Yes, seems to be the answer going by the experience of one of the largest developers in Mumbai — Housing Development and Infrastructure Ltd (HDIL).
Property buyers in Mumbai appear to be looking for 2004 prices in the current economic scenario, going by the responses that HDIL got last fortnight.
One of the large-scale real estate developers in Mumbai, HDIL has executed 32 projects spanning over 28 million sq.ft of saleable area, besides four million sq.ft under slum rehabilitation schemes in the city since 1996.
Primarily into residential housing, HDIL priced its March launches, comprising one- and two-BHK (bedroom-hall-kitchen) apartments at Kurla, a central suburb in the city, at Rs 5,251 a sq.ft — a level of pricing that prevailed there in 2004. The response has been overwhelming and the company, which opened bookings on March 6, has sold over 85 per cent of the 756 apartments till date.
Even in the present market conditions, where builders have lowered rates across the city, the Kurla project appears to be at least 30 per cent lower than the prevailing rates in the locality.
The second project of 413 apartments at Andheri, an upmarket locality close to the airport, too garnered good response so much so that the company has raised the price from Rs 7,651 a sq.ft to Rs 7,951 a sq.ft.
“We were looking for first-time buyers, who were pushed to the sidelines over the last three-four years and who form a sizable population of the working class in Mumbai,” says Mr Hariprakash Pandey, Deputy General Manager - Finance, HDIL.
Referring to the Kurla project, Mr Pandey says the offering of one and two BHK in the range of Rs 50 lakh fitted the bill of the middle and upper-middle classes who are willing to pay that much more for a central location with good road and rail connectivity, besides other infrastructure. “Many of our buyers told us that they had gone in for no more than a Rs 30 lakh loan by bringing in the balance as margin money,” he said.
The Andheri property too has its advantages, though the company managed to leverage on the prevailing rentals at the locale to arrive at the price point. With two BHK rentals at Rs 50,000-60,000 and buyers known to correlate rentals to the equated monthly instalments of bank loans, the pricing was seemingly attractive. “More importantly, there is no fresh supply coming in at the moment in the locality and the price is close to 40 per cent lower than the 2007 prices,” says Mr Pandey.
HDIL has lined up two more such launches in the coming months, where the price band would look overtly competitive to home-seekers.
Opts out of Dharavi
HDIL has pulled out of the Rs 15,000-crore Dharavi Redevelopment Project and may instead look for contracts from the bid winners.
Mr Pandey said the contract had become unviable and there was a great deal of uncertainty over the biding process. Further, there was no clarity in execution — how much space would have to be provided to the slum dwellers — 269 sq.ft or 400 sq.ft, besides the issue of premium the government sought for the slum resettlement project.
In 2007, the company was awarded the Mumbai international airport slum rehabilitation project as part of the Mumbai airport expansion project, which involves resettling 85,000 slum families by 2012.
Under phase I, HDIL plans to resettle 20,000 slum families on 38 acres at a cost of Rs 3,200 crore by December.
Posts
No comments:
Post a Comment