Properties in Delhi are undergoing a slump, in terms of demand. On one hand are the developers like Victory Ace and Krasa International, that are floating prestigious projects, on the other is the falling demand for Delhi property. The entire country is in the grip of economic crisis: inflation has broken the backs of buyers from middle-class and lower segments. The capital city is among the worst hit by this crisis. The demand for residential as well as commercial properties has hit an all-time low. As per a report by the realty firm Jones Lang LaSalle, in cases of the delayed projects, Delhi NCR is the one that is the worst hit.
As the inflation is spanning its wings, the demand for properties is waning in the city. With the plummeting of demand, the number of inventories piling month after month has become huge. In fact, Delhi property has fallen prey to delay in approvals by the authorities, lack of coordination in project- management, and inability of the developers to keep their promises. The unused/vacant inventories as old as 23 months are giving the builders sleepless nights. They are not able to find any takers. As if these things were not enough, the depreciating value of rupee against dollar, added to the woes.
The Delhi property has also seen a significant dip in FDI. The investors who bought multiple inventories in the hope of getting huge investments later, are bearing the most. In a frenzy to sell them all, they are agreeing even on lower prices. The lack of investors has also been due to several reasons like frequent change of property policies and stringent rules by the authorities.
South Delhi, one of the costliest regions of the city, has seen 20-25% fall in prices in the recent months. The new Land Farm Policy allowed the business class to get 1-acre plot of land for bungalows at lower prices in 26 scantly populated villages. This directly affected the prices in areas like Defence colony, Vasant Kunj, Greater Kailash, and Gulmohar Park. In these localities, a significant pile-up of inventories has become a major issue. The economic slowdown has further exacerbated the situation. With no takers, developers are trying to allure buyers by giving discount prices and freebies.
If the data from 2011 to 2013 is taken into account, Delhi has stood second in all the cities in the world, where sharpest appreciation has been noticed. Delhi property has seen a whopping raise of about 60% during this period, next only to Jaipur.
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