New Delhi: Residential property market is unlikely to revive in the next 12-18 months as the fundamental problem of lack of end-user buyers is unlikely to cha-nge any sooner, Crisil said on Tuesday. Real estate is one of the important engine which pushes up growth and give employment in the non-formal sector. To be sure, absorption of new homes has been on a slide for over six years now.
“Our analysis shows home sales in the top 10 cities — Ah-medabad, Bengaluru, Chandigarh, Chen-nai, Hyderabad, Ko-chi, Kolkata, MMR, NCR and Pune — have declined at a compound annual growth rate of 8 per cent since 2011. The trend appears set to last well into fiscal 2019 or beyond, portending more pain for developers,” said Crisil.
It said that one of the reason for low growth in the sector is that high property prices have turned end-users into fence-sitters in most micro markets. Though capital values have been under pressure over the past few quarters, a significant chunk of supply in many micro markets remain unaffordable. “Second, concerns over job losses and lack of employment opportunities on account of increasing aut-omation, among other things, are increasing. This curtails income visibility required for a housing loan,” it said.