Market study reveals that there is lack of confidence and sentiment in customers to actually come forward and swiftly make real estate buying decisions today. They are waiting for a price drop scenario now.
At a time when the Indian real estate is experiencing solid demand for properties, specifically in the affordable real estate segment, homebuyers are looking forward to dropping of price points in the near term.
This fact came into light in a recent buyer sentiment survey done by IIM Bangalore in the cities of Ahmedabad, Bengaluru, Chennai, Delhi, Gurgaon, Hyderabad, Kolkata, Mumbai, Noida and Pune.
As per the findings of the survey, the aggregate Housing Sentiment Index (HSI), measured across the 10 cities, dropped considerably by 29% in the 3rd quarter of 2014-15 to 81 points. This is a big drop considering the importance of sentiments in making the property buying decisions.
Furthermore, as per the survey, all the 10 cities witnessed a sharp decline in sentiments, with 8 out of 10 posting over 10% drop in sentiment. Ahmedabad, Delhi and Gurgaon witnessed over 25% correction in sentiments compared to the previous quarter.
And this happened primarily because of high inventory levels, soaring prices and increase in circle/guidance rates. All this contributed heavily towards the dismay of consumers and prevented them from making buying decisions swiftly.
Also revealed in the survey was the fact that over the past three quarters, housing market sentiment has swung from extreme excitement, witnessed just after the general elections, to sharp decline and further correction that reflect the actual reality on ground today.