Gurgaon has witnessed growth in supply of residential properties substantially in last two quarters of 2010, initially in affordable and subsequently in luxury or high end segments. The FDI funded projects have also made contribution in the current supply of residential properties.
As market came out of the recessionary period of 2008, and RBI took initiative in deploying liquidity in the market through its banking and financial institutions primarily to bail out the manufacturing, infrastructure and realty sectors, and to boost the sagging morale of business communities across the country, taking the cue from the soft regime initiated by the government, the realty space started absorbing the capital flow resulting into the growth and appreciation of real estate sectors particularly in Delhi, Gurgaon and Noida in northern India.
Affordable housing scheme launched by the developers like DLF & Unitech have been sold out within no time. Investors started buying these properties along with end users. For example Unitech launched three projects as affordable housing scheme in mid of 2009, namely Uniworld Garden II, Uniworld Residences and Sunbreeze, and sold out all the three projects in the price band of Rs 3000-3500 per square foot within a span of 4 months.
As those, who booked apartments in these projects initially, are now selling at the basic rate of Rs 4200-5200 per square foot. Similarly, in Luxury segment, the Golf Course Extension Road became the hot spots for futuristic development, with emerging developers brand like IREO, M3M, Pioneer, TATA, Bestech, Emaar MGF, have started high end projects like, Grand Arch, Victory Valley, Golf Estate, Marbella which are in true sense futuristic and high end in terms of space quality and infrastructural support.
Most of the projects of these developers are being sold at premium, because of investors, agents and builders have hyped the market for their own benefit.
Therefore in high end projects the demand is being artificially created to an extent of manipulating the price rise to attract further investment. The recent trend in price rise happened so sharp in residential plots, where price at some location became double in a span of six months only.
To provide roof to urban poor, the Government adapted Private Public partnership model which remained a complete failure, as the very framework of the model was defective and finally the urban housing for poor policy got defeated.
To arrest the price rise and to make it really affordable, the Government much take steps to check the activity or speculators and investors in real estate and must set norms or rules with proper screening, so that the needy should not feel marginalised at the cost of profit of the speculators. It is better soon than later; the regulatory body should be established for controlling the developers and real estate agents for the benefit of masses.
The market particularly in middle and luxury segment post October seem to be in corrective mode, as many new projects have been launched in HUDA Sectors of 70, 71, 72, 73, 75, 76, 82, 83, 84, 85, 86, 91, 101, 102, 110, 111 etc., where resale activities have gone down in last three months not only because of oversupply but also because of banks and lending institutions have hardened the interest rate to curb inflation. The trend is indicating the market to go for short term to mid-term correction.