Real estate Companies in Mumbai have managed to raise Rs 3,400 crore after Demonetisation

Several real estate firms have managed to raise Rs 3,400 crore in the past 2 months, following demonetization, which shows that there is not enough pressure on funding. Flushed with new credit lines, developers are getting a new lease of life to carry on to housing costs.

According to a financial report, firms like Rohan Lifespaces, Lodha Developers, ATS Builders, Puranik Builders, Kumar Urban Development, among others, are given debt in the months of Nov and December according to their MCA filings.

This includes funding from each housing finance firms and banks. “It clearly signifies that there's still excess liquidity within the system; whichever company isn't defaulting has access to capital.

In the past 2 years,  builders in Mumbai were not able to raise prices due to floundering sales, resulting in a natural time correction. Largely, companies were able to hold on to rates as funding, particularly through personal sources and structured debt, reached record high levels, providing developers the much needed support to not to surrender to client expectation and reduce costs.

Developers were positively enjoying the who-will-blink-first game with consumers rather than cutting costs, they most popular to borrow heavily from personal sources, notwithstanding it meant a heavier finance value, Limaye added. however post-demonetisation sales tumbled to a six-year low, intensifying expectations of a price reduction.

If there's no scarceness of funds, a minimum of the large-sized firms won't resort to cutting costs, specialists same. as an example, Bengaluru-based Sobha Developers has already same it'll not reduce prices in any of its projects because it believes costs in bangalore stay reasonable.

An analyst same it may be the argument for the end-user-driven southern market however hardly be extended to other geographies. Sumit Jain, national director of residential services at Colliers India, said there's far more pressure in markets like city and also the Delhi-NCR.

Click here to know the Realestate Trend in Mumbai