Secondary property market showing signs of recovery

Sales in the secondary property market are slowly picking up. Many developers and brokers have started buying property in anticipation of an increase in prices in the next 18-24 months.

“We’re looking at options in the secondary residential market in many places, especially Mumbai and the Delhi, National Capital Region, since the prices are flat and one will get a good deal. It is the best time to buy in the resale market,” a chief executive officer of a leading developer told Business Standard, on condition of anonymity. The secondary market has been showing good numbers in recent months.

A Noida-based broker, buying properties in good locations since last year, plans to sell at a higher price later this year, said: “Buyers are not coming in good numbers in the secondary market, though some sales have been happening. Prices have been stagnant for one or two years or only marginal uptake in specific localities.”

Over the past few years, brokers have also slowly started shifting towards the secondary market. Many are reluctant to buy new property because of fear of delay in possession and other issues. According to experts, the number of queries for ready to move in and resale properties have increased after the formation of a stable government. However, a revival in the sector is still seen as 18-24 months away.

New real estate portals such as PropTiger and Commonfloor are also focusing on the secondary market in a big way. Last week, realty portal PropTiger acquired Makaan.com, a major player in the secondary market.

The sector has been facing difficult times for the past few years, owing to issues ranging from delivery delays to fund crunch and declining sales. While the sector continues to be hit by a huge inventory, a drop in the number of new launches and delivery blues have shaken buyers’ and investors’ confidence.

“At PropTiger, our strength is end-to-end services in primary segment, while Makaan.com with its relationships with over 40,000 brokers across 50 major cities has great control of the secondary market; that's where the synergy will flow in from. We had already started the pilot project in the secondary market and are getting a good response. Soon, we will live in all cities where we have bases,” said PropTiger co-founder Prashan Agarwal.

SOURCE: Business Standard