May heat cools down Realty Market

By Dr. Sanjay Chaturvedi

After a usual rally, May month have seen a steep fall in sale volumes. This will result in further price correction in residential segment, especially on the outskirts of the cities and new developing zones. A usual rally in the months of March, April, October and November every year, where volumes increases for real estate transactions, was also witnessed by the sector in this calender year. Where March and April months have seen unprecedented increase in price due to demand coming in from redevelopment settlements and migratory trends because of transfers and employments. The academic year ends and people wants to settle in new areas, hence the demand.
Supply is huge and at this level, refuses to ease because there are no takers. Only sale happening because of desperateness and compulsions. Prices of residential segment in all the parts of the country have touched highest level of 2007 year. The speculators and investors wanted to increase their margin of profits in these months and have been very successful because of foolish attitude of panic buyers.
But market forces and market dynamics is so strong in its fundamental anaology that it correct it self. The rates already started cooling in May for Pune, Nashik, Faridabad, Mohali, Rajkot, Ranchi, Gwalior and Chennai. Metros, where news travels in less speed, as far as rate reduction is concerned, news is confined with brokers and agents, and market will digest new decreasing trend only in July or August.