Atul Joshi, who asked that his real name not be used, has been trying to sell his ancestral property, a three-storey house in one of South Mumbai’s best localities, for the past two years. He is willing to offer a big discount on his premium property, but there has been no buyer as yet.
“Wish I had thought of selling four years ago when the market was upbeat. Today there is so much supply in the market the customer is spoilt for choice,” the worried 43-year-old told CNBC.
According to Colliers India, there were about 1,80,000 unsold units in the Mumbai Metropolitan Region at the end of September. Such a high pile up of inventory has not been seen in two years. This is having a knock-on impact on developers.
“In the first six months of the year there has been a 40 percent year-on-year drop in new launches,” according to Arvind Kapoor, director India operations, residential at Colliers India.
He added that builders were looking to get rid of old inventory amid tepid demand, before launching any new projects. “It s a tough market,” Kapoor noted. “Even though builders may not be giving discounts openly, behind closed doors, negotiations are on.”
“The buyer is king, he is dreaming of getting everything free. For example, today a buyer expects to get an apartment priced at 70 million rupees [$1.1 million] for rupees 50 million [$760,000],” said Rajan Ahuja, a property broker in Mumbai’s prime localities. He added that some builders were now trying to let out apartments, having being unable to sell them even after offering incentives such as flexible payment options.