Realty launches set to move in step with investor sentiment

Real estate majors turn cautious with projects to prevent buildup of inventories in residential space

- GULVEEN AULAKH & PRACHI PISAL

Real estate majors have turned cautious with their project pipelines to prevent a buildup of inventories in the residential space as buyers and investors are holding off their realty expenditure amid a market tumble.

Developers and market watchers said the market was preparing for a cooling-off period in Mumbai, Gurugram, and some other markets that had seen rapid growth in residential projects and sales in 2023 and 2024, due to post-pandemic demand.

Insiders expect developers to take stock of capacities and ensure that inventories that can be absorbed go into the market.

"Gurugram's real estate market is highly liquidity-sensitive. So when equity markets slow or uncertainty rises, property sales tend to decelerate. At the moment, both buyers and developers are being cautious, not as a sign of a downturn but as a pause to reassess market conditions. This allows developers to ensure that only thoughtfully designed inventories, aligned with consumer needs, come to the market," Rakesh Bohra, chief operating officer, Gurugram-based Pioneer Urban Land & Infrastructure, told Business Standard in an interaction.

DLF, India's leading developer, too has warned of sales slowing as against previous quarters or even last year.

"What we have told you is be prepared for a flattening of the sales curve," DLF Chairman Rajiv Singh said in a recent meeting of investors, where he also noted that the pace of launches could be "lumpy" even as the Gurugram-based developer would attempt to "front-end" its launches.

Real estate analysts and research firms have reported the first quarter in 2025 seeing fewer sales than in previous years, largely due to rise in home prices, caution on the part of investors due to geopolitical developments and certain weaknesses in the Indian economy.