Buying property? Wait a bit longer

Survey: 45% Mumbaikars believe prices will fall further; builders too will be compelled to offer discounts and renegotiate fixed deals

Survey: 45% Mumbaikars believe prices will fall further; builders too will be compelled to offer discounts and renegotiate fixed deals

DEAR ESTATE: A real estate expert says buyers won't buy unless builders quote rational prices.

Property buyers have adopted the wait and watch strategy because they want property rates to fall further.
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Also, buyers are renegotiating fixed deals and even demanding further discounts. With the decrease in number of buyers, property sellers are complied to negotiate a lower deal.

According to a survey conducted by a real restate website Makaan.com, 45 per cent of Mumbaikars expect real estate prices to drop, while the statistics are 35 per cent in Delhi, 36 per cent in Bangalore and 39 per cent in Pune.

Aditya Verma, business head, Makaan.com, said, "With the expected revival in demand, we can expect price correction. Correction will continue in higher price segment."

However, the rest of the buyers have deferred their plans to buy property due to high interest rates on loans, job insecurities and the global economic slump.

Real-estate expert Ajay Chaturvedi said, "Buyers won't buy unless builders quote rational prices. Builders have already reduced their prices, but buyers are ready to wait for prices to drop further."

With property sellers complying with such demands, buyers are encouraged to renegotiate fixed deals.

According to Vibhoo Mehra, a real estate agent from Bandra, his client had fixed a deal at Rs 3.40 crore in mid-2008. But now the buyer wants to renegotiate the deal to Rs 3 crore.

"With the fall in the market, buyers have got a chance to renegotiate deals. Even sellers are ready to sell properties at a discount," said Mehra.

Don't wait too long

Experts warn that too long a wait can be dangerous. Raminder Grover, CEO of Homebay Residential, a real-estate consultancy, said, "While it is understandable that buyers wish to wait for prices to fall, there is a definite danger in waiting too long.

Just like the stock market, it is impossible to predict the lowest point in the real estate market. Buyers may lose out on the best property deals. Also, freebies and bargain rates last only as long as demand is low."