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Realty slump: Will low-end schemes work?

By BS Reporter in Mumbai, Pune
March 18, 2009 14:18 IST
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At a time when real estate developers are facing a slump, some of them in Pune have decided to offer attractive schemes and even enter the affordable housing segment.

Rated as one of the best real estate destinations by a number of agencies, Pune's realty market is fast losing its charm as developers are being forced to construct low-end schemes to increase sales.

While more than 260 real estate developers are willing to pay three EMIs of home loans taken by their clients and some have offered to rent apartments to future clients, Pune's top developer Goel Ganga group has launched four low-end affordable housing projects in the city.

Goel Ganga, known for its luxurious and high-end residential apartments in Pune, Bangalore and Mumbai, has recently launched a luxurious bungalow scheme in Bangalore at a price of Rs 3 crore (Rs 30 million) each. However, the shrinking sales have forced the developer to build 500 flats priced at Rs 18 lakh (Rs 180,000) onwards in four different localities in Pune. Interestingly, the price includes all the charges other than the face value, such as electricity connection charges, registration and stamp duty.

Speaking to Business Standard, Atul Goel, managing director, Goel Ganga said, "In the prevailing economic scenario, we have to provide affordable housing to individuals who are willing to buy flats. Our four projects will provide an excellent opportunity for home buyers in the city of Pune, which is yet to see a major price correction in the real estate market."

Goel Ganga group plans to invest Rs 150 crore (Rs 1.5 billion) in these four projects, which would be ready over next 24 months. "Even though these schemes are termed as 'affordable,' facilities such as jogging track, kids's pool, gardens, senior citizens club, gymnasium and others will be made available," Goel added. The group will continue to build large-size apartments and commercial properties at certain locations, he added.
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BS Reporter in Mumbai, Pune
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