Five years ago, the realty market of Noida looked very
different than what it looks now. Over these five years, the real estate sector
has witnessed a surge in property supply. However, does this mean that the
market gives what the consumer demands? Let’s find out.
Housing Sentiment Index (HSI), Apr-Jun 2015, a joint
initiative by IIM-B and Magicbricks, states that Rs 20-40 lakh category is the
most preferred price range. About 31.5 per cent respondents are looking to buy
property within this range followed by 19 per cent for the Rs 40- 60 lakh
category.
Does property supply match buyers’ demand? Not really!
According to Magicbricks' data, maximum properties available (44%) in Noida are
priced at Rs 50 lakh and above.
The major reason behind buyer preference towards lower
budget category is because of low income. As per the report, about 53 per cent
respondents earn less than Rs 10 lakh per annum, while another 26 per cent earn
between Rs 21-30 lakh yearly.
Let’s understand this from an example.
If a buyer has an annual income of Rs 10 lakh it means he
earns close to Rs 80,000 monthly after necessary deductions. Experts advise
that 30 per cent of the take-home salary should be invested in a home. Even if
the buyer stretches his budget and is ready to spend 50 per cent of his/her
monthly salary on loan, it is not enough.
Firstly, he will not be eligible for the full loan amount.
In case he is eligible, then there are other expenses such as stamp duty and
registration costs which add to the value of the property. Therefore, the Rs
20-40 lakh category is highly preferred compared to the other ranges.
Source: Magicbricks
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