By Nikita Parekh, Sub-Editor,
The sluggish real estate market has bind developers to launch new brands for affordable housing under the group’s name, the property market is down since long time, despite of high demand for homes, there is very low sales due to high prices of property. To cop up with the demand of affordable home developers and to generate sales, developers are launching new brand under its group’s name for construction of affordable homes, instead of reducing the rates.
Recently, Shapoorji Pallonji Group, one of the oldest developers launched affordable housing brand Joyville, which will construct only affordable homes all over the country, targeting the working class, salaried, service sector households. Paranjape Schemes one of the leading developers in Pune also announced its entry into the affordable housing segment under the new brand ‘Happiness Hub’, focusing more on Tier 2 and Tier 3 cities.
Essel Group have also announced its foray into affordable housing, the group will undertake real estate projects in various states under Affordable Shelter and Housing for All (Asha) 2022 by tying up with different partners and entrepreneurs for development of affordable homes. At the launch Essel Group chairman Dr Subhash Chandra had said, “You should enter the market when it is down. This has always been our philosophy.”
Private and big developers only prefer to foray into the affordable housing segment when the market is sluggish and sales are down. As per a recent report by Knight Frank property consultant, last year the real estate sector witness a fall in sales of housing in eight major cities by 4 per cent to 2,63,720 units, this figure is lowest since 2010.
The unsold inventories have declined marginally to 6.91 lakh units from nearly 7.15 lakh units in 2014. Developers would take more than 2.5 years to exhaust this unsold stock.
Developers are unable to sell their luxury and premium projects as buyers are unable to afford the high prices quoted by them. Hence, to earn some profit and generate some sales developers are entering the affordable housing segment with a new brand, so that their parental company’s name is not affected or tagged as affordable housing provider. Big brands generally do not prefer to be named as affordable housing provider or reduce their rates, as they are popularly known as premium housing providers and their main target are not salaried people or service sector, but corporate people, high netwoth individuals, NRIs.