Real estate prices across top Indian states have reduced by 1 to 5% in the April-June quarter due to the COVID-19 pandemic. However, the prices were down by 2-9% in the month of April but were later recovered.
This time the country’s costliest real estate market, Mumbai has faced a lack of cash flow that led to reduction in demand and ultimately decline in the prices. Mumbai’s property prices crashed as the developers are struggling for funds and the buyers are waiting for the situation to get normal.
Central Mumbai developers are tensed for funds, in markets such as Thane as sufficient availability is stressing them to cut down the prices. The city has hardly witnessed any sales over the last few months due to the lockdown imposed to prevent COVID-19 outbreak and realty developers are trying to decide price cuts across the residential markets.
Recently, Union Minister Piyush Goyal had suggested that the developers should reduce prices and sell their inventory instead of waiting for the market to surge. In the month of April, HDFC chairman Deepak Parekh also stated that property developers should prepare themselves to face a fall of around 20 per cent for housing prices and must work in order to generate liquidity by selling their inventory at low prices.
Some property agents are of a view that price cuts are desperate attempts by developers to generate sales which were shaded for the past few years due to high prices. It is expected that India’s economy would get back to normal after the relaxation from restrictions imposed amid coronavirus. The real estate sector is hoping to witness a positive sign as some homebuyers are back in the market to seek properties. It has high hopes to recover as the buyers are connecting with agents through different online platforms and surpass the pre-COVID levels.