Diwali 2024: Bengaluru Real Estate Developers Focus on New Launches
Bengaluru's real estate market is gearing up for a festive season with new project launches, but traditional discounts and offers are taking a backseat.
Bengaluru Real EstateDiwali 2024Property LaunchesReal Estate MarketFestive OffersReal Estate MumbaiOct 28, 2024
As opposed to offering festive discounts and incentives ranging from gold coins to holiday packages, complementary white goods, and flexible payment plans, realty players in Bengaluru are channeling their focus into strategic launches. This shift comes amid record sales observed in 2023 and so far in 2024.
“The reason is, there is no pressure to sell. Discounts are usually given when they want to sell and dispose of a lot of inventory. The developers know that the prices will appreciate much faster in the coming years, so even if they don't sell, they're sitting on good, hefty profits holding on to the inventory,” explained Bhavesh Kothari, founder and CEO of Property First Realty LLP.
Interestingly, last year there were very minimal offers and discounts as housing sales were fairly strong, pointed out Prashant Thakur, Regional Director and Head – Research, ANAROCK Group. As per Anarock Research, the unsold inventory in Bengaluru stood at approximately 46,315 units at the end of the third quarter of 2024, a 6% decrease compared to the same period last year, which saw 49,345 units as of Q3 2023-end.
To present a broader comparative picture, the available inventory in Delhi-NCR and Mumbai at the end of Q3 2024 stood at 85,500 and 1,88,700 units, respectively. Despite the new supply added into the market over the year, Bengaluru's inventory has seen a significant reduction.
Several real estate majors in Bengaluru, including listed players such as Puravankara Limited, have disclosed that there are no official plans to roll out festive deals and discounts this year. Instead, many are looking to infuse fresh supply into the market with strategic launches planned for the quarter.
Sattva Group is set to launch two projects in the coming month. One will be a 20-acre plotted development in Devanahalli, and the other will be a luxury residential project in JP Nagar. This follows the launch of two projects last month Sattva Songbird off Budigere Road and Sattva Lumina on Yelahanka-Doddaballapur Main Road. Sattva Songbird will comprise 1,300 apartments and 58 luxury row houses upon completion, with unit pricing starting at ₹40 lakh onwards. Meanwhile, Sattva Lumina will offer 1,500 high-rise home units across a 13-acre land parcel, with apartment costs starting from ₹62 lakh onwards, exclusive of taxes.
“For the season, we do not have any particular offers, but just to mark the occasion and because it is an auspicious time of the year, with every booking, we will give customers a gold coin, not as an incentive to buy our products over others,” said Shivam Agarwal, Vice President of Strategic Growth, Sattva Group.
Another developer, Concorde, is eyeing three project launches over the next three months, with each unit priced within the range of ₹80 lakh to ₹2.5 crore. The company has upped its marketing spend by 25% this festive season and ramped up efforts to cater to the non-resident Indian segment of buyers, said Kranti Alladi, Chief Sales and Marketing Officer, Concorde. “Regarding inventory, we are experiencing some constraints in specific micro-markets due to increased demand,” Alladi added.
Yet another player in the city, Century Real Estate, is holding back on incentives this festive season on account of a similar inventory crunch, said company director Maninder Chhabra.
Meanwhile, some developers are also looking to introduce innovative schemes as part of their launches. “This is the first time that during the launch of one of our projects, which is ready-to-move-in, we’ll be giving a rental scheme to the homebuyers. We’re going to be pre-tenanting the units out on behalf of the customers and selling it with a 2-3 year lease plan,” explained Angad Bedi, Chairman and Managing Director, BCD Group.
The December quarter in India traditionally bodes well for the real estate sector as the festival season is considered an auspicious time to make big-ticket purchases, including homes. Simultaneously, festive offers are utilized by developers to clear unsold inventory, experts said. However, they added that festive season discounts and offers do not necessarily influence the decisions of property buyers, especially in the mid-income and luxury segments. They can, at best, help in expediting the booking timeline.
According to a July report by JLL Research, Bengaluru emerged as the premier residential real estate market across India with 18,548 housing units sold and 16,537 homes launched during the April-June period of the ongoing calendar year. The IT capital accounted for approximately 21% of the total residential launches and around 23% of the home sales pan India during the three-month period. The study credited sustained demand for property in Bengaluru, supported by the booming IT sector, infrastructure upgradation programs, and a conducive business environment for the feat.
Incidentally, the unit launches in the first half-yearly period of 29,153 units had reached approximately 60% of the highest ever annual launches seen in Bengaluru during the year 2022. As of H1 2024, unsold inventory in Bengaluru decreased by approximately 21% on a year-on-year basis as sales outpaced launches. The total unsold inventory stood at 70,147 units by the end of the first half of 2024. One of the factors contributing to this drop in unsold inventory can be approximately 31% of the H1 2024 launches being sold out during the same period. With anticipated momentum in the coming quarters, the months to sell for the available inventory are likely to decline further in the near to medium term, JLL said.
Frequently Asked Questions
Are there any festive discounts available in Bengaluru's real estate market this Diwali?
Not many developers are offering traditional festive discounts this year. They are focusing more on strategic new project launches.
What new projects are being launched in Bengaluru this Diwali?
Sattva Group is launching two projects: a 20-acre development in Devanahalli and a luxury project in JP Nagar. Concorde is also planning to launch three new projects.
Why are developers not offering discounts this Diwali?
Developers are confident about the market and expect property prices to appreciate in the coming years, so they are focusing on strategic launches rather than discounts.
What innovative schemes are being introduced by developers?
BCD Group is introducing a rental scheme where they will pre-tenant the units and sell them with a 2-3 year lease plan.
How is the unsold inventory in Bengaluru's real estate market changing?
The unsold inventory in Bengaluru has decreased by approximately 21% on a year-on-year basis as sales have outpaced new launches.
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