Amidst Rising Interest Rates, Realty Companies to Offer Discounts to Buyers

In view of the increase in repo rate, premier lenders like Axis, ICICI and HDFC have revised their loan interest rates. This move has made matters worse for realty companies, which were already under pressure on account of slow economy and less demand for housing projects.

This scenario puts realty firms at stake, who is desperately trying to clear off inventory. As part of the attempts, buyers would be given several offers this upcoming festive season.

The recent report by Credai, the Confederation of Real Estate Developers' Associations of India says, the launch of new products has been much less in comparison with last year. Also, according to Liases Foras, property research firm, the fall in property rates has affected sales of 670 million sq ft of stock throughout the nation. Previous festive season reported ten percent more new projects.

Industry observers are closely following the trends, and see less chances of new projects filling the gap as most of the builders would be focusing on clearing off inventory.  Builders are planning to introduce new schemes to attract buyers.

The fall in property demand and rates was seen in 22 of 26 cities, owing to economic slowdown, recent job cuts and upward inflation.

Rajeev Talwar, executive director of DLF, India’s largest real estate firm pointed out that it was a wrong move in terms of real estate sales to increase the rates this time.

Builders are even willing to include amendments in the existing structure as well as payment scheme to lure more buyers. With banks raising their loan rates, property buyers can look forward to lucrative offers from developers this season.