The impact of festive season on property market trends: What to expect

The festive season, spanning from Ganesh Chaturthi to the dawn of the new year, has long held a special place in the hearts of homebuyers in India, and this year is no exception, say experts. Developers expect a boost in business, with projections of 15 per cent to 20 per cent growth in comparison to the previous year.
"As the nation has entered the festive season, the anticipation is high for a surge in property sales, reductions in unsold inventories, and increased activity in the real estate market," Mukesh Mishra, Co-founder, Homesfy told Republic.

“The anticipation for this festive season is that the sales will be robust as people will be investing more in 2 BHKs as larger homes are being preferred in areas like Kharghar, Navi Mumbai and Thane as the price of 2 BHK in suburbs is sky-rocketing. Also, with the upcoming infrastructure and transport facilities, homebuyers will be taking an informed decision of purchasing homes in Kharghar and Upper Kharghar areas as the prices are still low as compared to the other area,” said Bhavesh Shah, Joint Managing Director, Today Global Developers.

Rising confidence amidst global inflation

The impact of global inflation on housing prices has been a topic of concern. However, according to experts, the property market appears to have achieved a level of stability that fosters buyer confidence.
"This stability is attributed to the deep-seated belief in the auspiciousness of the festive season, which encourages prospective buyers to enter the market," said  Shashank Vashishtha, Executive Director, eXp Realty India.

"This faith in the festive season's significance is bolstered by the various offerings and promotions introduced by developers, including exclusive offers, discounts, and flexible payment options," he added

Developers play a pivotal role during this season by enticing buyers with deals. These can result in savings, with buyers potentially enjoying up to 10 per cent off on property purchases. Furthermore, developers expect a significant boost in business, with projections of minimum 20 per cent growth in comparison to the previous year. The sustained demand for larger, more luxurious homes underscores evolving lifestyle preferences, highlighting the preference for spacious and comfortable living spaces.

Last year's festive resilience

Despite facing challenges such as the 'shraadh' period, erratic monsoons, and escalating property prices and interest rates, the housing sector continued its momentum during the third quarter of 2022.
According to the data from Anarock Group, 88,230 housing units were sold across the top 7 cities during Q3 2022, an increase of 4 per cent compared to the second quarter and 41 per cent surge compared to the same period in 2021.

National Capital Region (NCR), Mumbai Metropolitan Region (MMR), Bengaluru, Pune, and Hyderabad played a significant role in driving this surge, collectively accounting for 90 per cent of the total sales during this quarter.

Key triggers for Mumbai Metropolitan Region (MMR)

The Mumbai Metropolitan Region (MMR) is set to witness some key triggers in the property market. A medium-term increase in property volume is expected following a boost in infrastructure development. "Additionally, an increase in wages, employment opportunities, and a return-to-work scenario are anticipated to maintain healthy home buying activity," said Manan Shah, Managing Director, MICL Group.

Historically, registrations in the region have seen an upswing between the months of October to January, marking the second half of the calendar year.

"Government policies, such as the Mumbai Development Plan 2034, have opened up the potential for land redevelopment. This has created opportunities for Joint Development Agreements (JDAs) and Joint Ventures (JVs) within the real estate sector. JDAs and JVs are seen as a mechanism to bridge the gap between supply and demand in the MMR," Shah added.

These agreements enable the steady supply of properties in the market and provide organised players with enhanced negotiation leverage compared to others.

Going ahead, the real estate industry is positioned more robustly than in the pre-pandemic era. "Developers' credit profiles continue to improve thanks to healthy collections and reduced debt levels. Planned property launches are strategically aligned with the incremental demand, indicating a promising future for the property market in India," Mishra added.

"Homebuyers are preparing to take advantage of auspicious timing, while developers are gearing up to meet their demands with a range of enticing offers and promotions. This convergence of belief and business is expected to shape the property market trends in the coming months."  Vashishtha said.