Stagnant market proves ideal for a common man : The Tribune India

Join Whatsapp Channel

Real Estate retrospect - 2018 The year of survival: Punjab

Stagnant market proves ideal for a common man

Builders and property dealers now concede that the stagnant real estate market in the state proved to be a boon for common man in 2018.

Stagnant market proves ideal for a common man


Sanjeev Singh Bariana

Builders and property dealers now concede that the stagnant real estate market in the state proved to be a boon for common man in 2018. End-user emerged as a king even as the prices remained stagnant and completion of projects remained slow. All major towns of the state, including Mohali, Ludhiana, Jalandhar, Amritsar, Patiala and Bathinda have a number of ongoing projects, but the construction pace remained slow in 2018.  Industry mavens claimed that the projects where a majority of buyers were investors were the worst hit, while developers of affordable projects with end users as buyers were the ones completing their projects. For example, the Alpine Residency Society, Zirakpur, that is a cooperative society of professionals has 94 out of 96 flats occupied, whereas Silver City, also in Zirakpur, built more than 12 years ago, has a large number of unoccupied flats despite its prime location. Reason being that most of the buyers of this project are NRIs. As Ritu Sharma, a nurse in a private hospital, says, “Good construction with all basic services has made luxury an attractive investment for us as well”. 

The President of the Punjab chapter of the Confederation of Real Estate Developers’ Associations of India (CREDAI), Kulwant Singh, says, “Tax on the rental, on one hand and increased bank loan rates are proving to be a deterrent for those who had invested in property anticipating hefty profits. At the same time timely payment by genuine investors leading to timely completion of projects is allowing good investment.”

“In 2018 there was no linear growth in sale or occupancy of property, both residential and commercial”, says Bhupinder Singh, a leading property consultant from Patiala. The price of property in Patiala was largely governed by location, connectivity and development of the area in 2018. The market however, remained stagnant as a majority of owners held on to their assets in anticipation of a revival.” 

Experts feel that the demonitisation has proven to be a deterrent for a big chunk of investors who were investing in property to park unaccounted cash. 

Ground check

In the last auction of the year held last week (December 14), residential plots on Ajnala Road (Block B) were auctioned between Rs 48,900 per square yard and Rs 59,000 per square yard, which is definitely high. Commercial property on Ajnala Road was auctioned for as high as Rs 2.17 lakh per sq yd. In Bathinda, Dabwali road where the AIIMS project is coming up, and Bucho Khurd village on the Bathinda-Zirakpur road that has more than 40 factory outlets, including premium brands fetched a premium. While many new properties in Ludhiana and Amritsar are selling like hot cakes, the Improvement Trust properties, including those in Bathinda, found no buyers this year. In fact property prices in tier III cities and towns in the state showed no movement for third year in a row.

Illegal colonies

Punjab has between 7,000 and 8,000 unapproved colonies. Nearly eight months after the new regularisation of illegal colonies policy rolled by the Congress government, only 33 developers have applied for regularisation, a PUDA functionary said. Political backing enjoyed by builders has been the main reason for the ‘failure’ of this scheme. For example Local Government Minister Navjot Singh Sidhu faced opposition from a local Congress MLA when he spearheaded a massive campaign in Jalandhar. President of the Punjab Colonisers and Property Dealers Association, Kultar Singh Jogi, says, “Unless the state government simplifies the rules and simplified procedural wrangles, the new policy will have no impact. Paper work is tedious. We are still forced to travel long distances”.  

NRI investors dwindling

Jalandhar-based Sukhdev Singh feels that unlike earlier times, NRIs are not investing back home now. One major reason being that children of those who had migrated 25-30 years back are not interested in retuning to India now. And children of well-to-do families in India, too, want to go abroad first for their studies and then settle there. Media reports on the alleged harassment of a large number of NRIs for their properties have also led to trust deficit among NRI investors.

RERA

The Real Estate (Regulation and Development) Act or RERA makes it mandatory for all commercial and residential real estate projects where the land is over 500 square metres, or eight apartments, to register. Besides, all new constructions, all ongoing construction is also required to get a completion certificate. “Projects in this category have come up with the required permission. However, registration with RERA, on completion of works, is pending. On ground, only 600 parties, including ongoing projects, have registered with RERA till date, which is far below the expected number of nearly 1,500. There is a poor check mechanism on ground. Sanjiv Gupta, member, RERA-Punjab, says “We have given a last opportunity to developers to register. Show cause notices will be issued to a large number for non-compliance.” 

— With inputs from Sukhmeet Bhasin (Bathinda), Kuldip Bhatia (Ludhiana) and Aakansha Bharadwaj (Jalandhar)

Top News

Jailed gangster-politician Mukhtar Ansari dies of cardiac arrest

Jailed gangster-politician Mukhtar Ansari dies of cardiac arrest

Ansari was hospitalised after he complained of abdominal pai...

Delhi High Court dismisses PIL to remove Arvind Kejriwal from CM post after arrest

Delhi High Court dismisses PIL to remove Arvind Kejriwal from CM post after arrest

The bench refuses to comment on merits of the issue, saying ...

Arvind Kejriwal to be produced before Delhi court today as 6-day ED custody ends

Excise policy case: Delhi court extends ED custody of Chief Minister Arvind Kejriwal till April 1

In his submissions, Kejriwal said, ‘I am named by 4 witnesse...

‘Unwarranted, unacceptable’: India on US remarks on Delhi CM Arvind Kejriwal’s arrest

‘Unwarranted, unacceptable’: India on US remarks on Delhi CM Arvind Kejriwal’s arrest

MEA spokesperson says India is proud of its independent and ...

Gujarat court sentences former IPS officer Sanjiv Bhatt to 20 years in jail in 1996 drug case

Gujarat court sentences former IPS officer Sanjiv Bhatt to 20 years in jail in 1996 drug case

Bhatt, who was sacked from the force in 2015, is already beh...


Cities

View All