New Delhi-based real estate developers DLF and Parsvnath plan to cut property prices by as much as 15 per cent in the next few months to boost sales.
The cut comes as part of their plans to launch affordable housing project to lure buyers. Referring to slowing sales, Rajiv Singh, VC, DLF, said the cut in prices will be visible in the next three months.
The developer has already cut prices in Hyderabad. The new projects are expected to be at least 10-15 per cent cheaper than similar projects that were announced a year ago, he said.
DLF indicated on Monday that it will launch two-, three-bedroom apartment projects in select cities in the coming months. A price range of Rs 25-40 lakhs (Rs 2.5 to 4 million) has also been indicated. Singh said the profit margins will be reasonable at around 25 per cent.
Parsvnath, which saw a 94 per cent dip in its net profit during the December quarter due to a slump in sales, also said its immediate focus will be to launch housing projects with a lesser price tag.
The company, which has halted all its diversification and overseas expansion plans, said the profit margins on its new projects will be around 25 per cent, 10 per cent less than what it used to enjoy during the boom time.
The real estate players however said the new projects will not have the same specifications as that of the earlier ones to partially set off the reduction in prices.
If a three-bed room flat in Noida is currently costing Rs 65-70 lakhs (Rs 6.5 to 7 million), the new project which we announce in a 2-3 km radius may be priced at Rs 40 lakhs (Rs 4 million).
However, the size of the flat, the specifications etc will be different, Pradeep Jain, CMD, Parsvnath, said.
