"Residentials hot, commercial space not.
With developers forced to return to the drawing board to make projects financially viable, the landscape is, indeed, changing."
Many commercial property areas are supposed to be only commercial. Its a way to ensure that there is uniform distribution of activities and that there is equitable growth withing the city's numerous sub sections. Also these builders claim incentives like cheap electricity and water from the civic authorities for commercial projects.
India has none or non existent zoning rules, you can mix educational, shopping, recreation, residential, commercial and industrial units in any city block without any awareness of consequences. Does this mean that zoning only for demarcating and industrial land. Why should a builder that owns a piece of land intended for commercial use - that can generate thousands of jobs and provide nearby residents place to shop, be allowed to switch to residential plans. Such haphazard plans not only lead to uneven development, it gives rise to unnecessary skewing of prices.
The same article also quotes
"Inventory days in the two cities have fallen back to early 2008 levels or better. However, the overhang in Bangalore, Chennai, Gurgaon and Hyderabad remains significant with at least 15 months of inventory in the pipeline," Goldman analysts Vishnu Gopal and Aditya Soman wrote.
Well, if GSachs is right, then I don't see how the over supply is going to be filled at current rates. In cities like Pune, there have been lot of shady dealings where builders have given huge discounts but have prolonged delivery of the house. This very similar to the years 1997-2000 where rates were decreasing but not collapsing.On a Lighter note with the swine flu scare, I am hoping the rush of people to the city will at least pause :) and open some window of opportunity. :) FYI I genuinely think Pune will bottom post Diwali - at least in suburbs.
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