Is it the Right Time to Sell Your Property?
The last increase of repo rates by the Reserve Bank of India (RBI) has again put the Indian realty sector and property buyers on the back foot. The situation of uncertainty is also expected to calm down only after the general elections. At this point of time, both developers as well as property owners are on equal footing to sell their property with developers going an additional distance to negotiate deals. In such a scenario, one always asks the question – Is it the right time to sell my property?
The situation at hand
During the beginning of the year, the RBI increased the repo rates for the third time within the last six months. This has led to home buyers going on a back foot fearing a possible increase in home loan rates. In this situation, both developers as well as resellers are in a tighter spot. The biggest fear of developers is the possible inventory pile up adding to the already existing inventory. As such, they are willing to go the extra mile to negotiate good deals. This has added a bit to the burden of an individual home seller.
Is this the right time to sell?
Property consultants and experts have opined that the worst may be over and in 2014, the real estate sector will start seeing signs of revival. However, they also suggest property owners to hold-off selling for some more time. According to Jones Lang LaSalle India, capital values of property across different segments in most cities are stagnant except for few cities such as Bangalore, Kolkata, Pune and Mumbai which are seeing a slightly upward trend. Hence, the seller will benefit from holding the right kind of property in the right segment in the right city.
Several real estate veterans and experts suggest that unless absolutely necessary it is wise to hold-off selling at least till the general elections are over as the market currently has poor fundamentals, low liquidity and weak sentiments. As such, it may take longer to sell a property at this point of time.
Identifying the right time
The right time to sell a property depends on the economic fundamentals and capital value trends in the specific area, applicable taxation, developments etc. If the country’s GDP is growing well, interest rates will be low. Consequentially, the market sentiment will be buoyant and the conditions are right to sell. Other factors that also command good profit are the locality’s infrastructure such as roads, water and electricity, development of social amenities and entertainment facilities. If the city or the micro-market has a vibrant real estate activity, one can expect to reap good profits by selling a property.
