Hush in Haryana

Sunit Dhawan

The real-estate sector in Haryana, which had witnessed an unprecedented rise in the past decade or so, seems to have hit a roadblock and has been witnessing a downward trend for about a couple of years now.

Property prices have come down considerably, sale-purchase is quite low and no immediate revival is in sight. As a result, investors are shying away from the market and have started exploring other options for the sake of safe, sound and sure returns.

As of now, only the end-users are looking for good bargains in view of the slump, but not many transactions are taking place as most of the property-owners prefer to wait for the market to look up, unless there is some pressing necessity.

“While a good number of potential buyers are waiting for the prices to come down further, the owners are hoping for the prices to go up. In this tug-of-war, the volume of property transactions has hit a rock-bottom,” explains Ashok Kumar, a Gurgaon-based market observer.

The high price of HUDA plots fixed by the authorities “concerned” have also put off the investors as well as the end-users, as a result of which the number of applicants for HUDA plots has come crashing down in the recent past.

“Gone are the days when investors used to form large groups and applied for a number of HUDA plots simultaneously in hope for making a killing in the event of allotment,” remarks Umed Singh Hooda, a Rohtak-based dealer.

The situation has come to such a passé that the HUDA plots, the allotment of which was considered like winning a big lottery, have now become more of a liability, especially for the recent allottees who have paid a substantial amount.

Market analysts point out that many owners of HUDA plots, who had applied for these in hope for handsome returns, have surrendered their plots to the HUDA authorities so that they get their money back.

“A number of such instances have been observed in HUDA sectors recently developed in Ambala, Tarawari, Kalanwali and Fatehabad. The high rates of HUDA plots in towns like Dadri and Safidon have resulted in a very low number of takers applying for the same,” says Bhag Chand Verma, a Hisar-based property adviser.

In short, a majority of state residents have got disillusioned with the HUDA plots in the wake of exorbitant prices and negligible returns, and similar is the situation in case of Housing Board property.

The slump is more pronounced in the residential segment, though the commercial property is also not insulated from the trend.

There are different theories to explain the slowdown in the property market. While some realtors observe that a downhill phase is witnessed after a long upward trend, others attribute it to political reasons.

Nonetheless, the theory of non-political course correction seems to hold more ground as the downward trend had begun before the change of governments at the Centre as well as in the state.

The high rates of property in HUDA sectors as well as increased collector rates have also had a devastating impact on the realty sector which was shining brightly till recently.

The slowdown is not specific to the HUDA sectors, but is also evident elsewhere, even in the unauthorised colonies located on the outskirts and in other pockets of Haryana towns/cities.

The rates of residential property in the townships developed by private builders in Gurgaon, Faridabad, Rohtak, Sonepat and other districts in the national capital region (NCR) have also come down considerably, as per real-estate agents.

“The vertical expansion taking place in the property segment with the construction of high-rise residential complexes has resulted in a situation in which the availability/supply of dwelling units has largely exceeded the actual demand,” maintains Manik Juneja, a property-owner based in the NCR.

He points out that that in the given circumstances, there is a slim chance of the realty sector looking up in the near future. “It will take at least a couple of years to rebuild a robust market,” he asserts.

The expansion of the Metro Rail network towards Haryana and introduction of the Smart City project in the state have been able to arrest the downward trend to some extent.

The property scenario is also likely to pick up with the completion of the much-hyped and long-awaited Kundli-Manesar-Palwal (KMP) Expressway project.

In the meanwhile, the property developers across the state have welcomed the Reserve Bank of India (RBI) move to cut the repo rate, but have also urged the authorities concerned in the banking sector to pass on the benefits to the consumers by easing the home-loan rates.