Realty cos gear up to meet FY24 launch target
₹1.87 crore. On 21 November, the stock was rewarded by the Street, soaring to a 52-week high of ₹1,415 apiece. As things stand, residential property sales of listed companies have been immune to a rising interest rate scenario.
Now, the spectre of rate hikes is largely out of the sector’s way, providing some breather to property buyers who have taken home loans. That said, interest rate cuts are awaited. A delay could keep home loans elevated for longer.
Plus, realtors have taken price hikes for select projects and locations, partly due to increased input costs. Steep price hikes could hurt affordability and derail the demand momentum. Average residential prices in key micro markets across the top seven cities have seen a significant surge between October-end 2020 and the corresponding period in 2023, said Anarock Property Consultants.
Key IT-led micro-markets in Hyderabad, Bengaluru and Pune saw the highest surge in average prices in this span. Pune’s prominent localities of Wagholi, Hinjewadi and Wakad–all three in the city’s IT influence zone–saw average prices rise by 25%, 22% and 19%, respectively, according to Anarock. But the tailwinds are reversing with the boom in the IT sector during the pandemic, which had given real estate sales a shot in the arm, fizzling out.
The Indian IT sector is coping with demand uncertainty, which has meant subdued hiring. If the IT sector’s fortunes do not revive soon then it could have a bearing on the residential property sales momentum. Besides, any upward revisions in stamp duty on residential real estate post key state elections, such as in Telangana, could be a dampener.
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