The past one year has been tough on real estate sector as much as on any other sector. But it has not all been bad and 2013 had its high points. The year may not have met optimistic expectations but with the underlying demand for housing stable, there is no real concern in the long term, says R. Kumar, Managing Director, Navin Housing & Properties and Chairman, Confederation of Real Estate Developers Association of India – Tamil Nadu. He shares with Business Line some of the trends seen during the year.

How has the last one year been for the real estate sector in Chennai?

The year started out well for the sector with a good number of launches in the first half, which was also quite active in terms of transactions and sale of built up space. But this tapered of in the second half. There were a few launches in the third quarter of the year and then a lull in the last quarter of the calendar year. This was primarily due to the overall sentiment brought about by a slow economy.

How have the developers reacted to it?

You have to notice that the year was not all bad. For instance, Navin’s revenues in 2013 are nearly double that in 2012. We sold more apartments and collected more money this year than we did last year. People preferred near city locations. Navin concentrates on prime areas in the city and the near suburbs. This is true of developers who concentrated on areas where there is an existing demand. It is only the far suburbs that suffered the most.

Have the prices come down for buyers?

The market conditions have certainly impacted prices. Residential prices have stagnated during the last two quarters. New projects are being launched at lower prices. Even if prices are held constant that is a benefit of 5-6 per cent as compared with the previous increasing trends. Project launches in the first half of the year added to the stocks and buyers had a choice of products.

What would you see as the highlight during the year?

The significant sized land deals in the city in prime residential areas such as Nungambakkam, Egmore, Adyar and Purasawakkam.

High end projects were also launched at unprecedented price points up to Rs 20,000 – 25,000 a square feet. This was another segment that emerged – demand for quality living space in the city. These transactions started in the middle of 2013 and have continued into the last quarter of the year. These are some significant high points in an otherwise dull year.

What are the areas of concern?

Projects continue to be delayed and the hoped for support for real estate development has not materialised either from the State Governments or the Centre. The Real Estate Regulatory Bill will only add to the cost of development and is skewed in its approach. It places the responsibility of compliance on the developers alone. Other stakeholders -- including buyers, financial institutions, government agencies handling utilities and approvals are not held accountable under this proposed law.

What is the outlook for the coming year?

Developers are upbeat on the outlook for the coming year. The coming Parliamentary elections and a new government coming taking over could improve overall sentiments.

balaji.ar@thehindu.co.in

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