The group is now approaching local real-estate agents to sell its properties at Lodha Aqua, its high-priced project in suburban Mumbai

The Lodha group, which was selling its ‘Lodha Aqua’ (near Dahisar, suburban Mumbai) property exclusively through invitation, has now climbed down and is seeking the help of local agents to sell the properties in its project. Around 150 real-estate agents between Malad and Bhayander (in suburban Mumbai) were invited for a get-together on Saturday (22nd May) at the project site. A company official has offered local real-estate agents a deal for selling its properties in the Aqua project.

The official also announced details of the project (current prices, size of the flat, etc). The developer is offering a commission of 2% per transaction to the local real-estate agents. Earlier, Lodha was confident that it would be able to sell off all its properties through its corporate sales team and with a handful of realty brokers. But that did not work out and now it is opening the gate for local real-estate agents.

“The developer invited local real-estate agents between Malad and Bhayander for a get-together on Saturday to create an awareness of the project and also offered us to a deal to sell the properties in Lodha Aqua more aggressively. Earlier very few brokers were allowed to sell the properties in this project but now it is accessible for most of the agents within this locality,” said Nilesh Pandey (name changed), a real-estate agent in Mira Road.
 
In December 2009, the developer jacked up the price for the project to Rs6,399 per sq ft. Currently the developer is quoting a price of Rs5,600 per sq ft, according to the real-estate agent who attended the party.

“Big developers also need the involvement of local real-estate agents to push sales. Local residents are more comfortable dealing with local brokers,” said Vinod Sampat, a Mumbai-based property lawyer.

Besides involving local players, Lodha has also reduced the price of a few properties in Lodha Aqua. This shows that developers have now started reducing prices of their properties. The Lodha Group launched ‘Lodha Aqua’ in 2007 and is still struggling to sell its properties in the project. At the time of the launch, the developer claimed that it had sold 300 units at Rs5,850 per sq ft (comprising two bedrooms, hall & kitchen (2BHK), with an area of 1,017 sq ft and 3BHK with an area of 1,395 sq ft).

Most developers in Mumbai and Delhi are facing problems in clearing their inventories as they have jacked up the prices of their properties. They are trying all they can to clear inventories. “Post the recession, the increase is volume that you had seen will subdue. In certain segments, prices have increased by 30%-40%. We are going to see lower volumes of transactions in the next six months compared to the last six months, if the prices do not come down,” said Pranay Vakil, chairman, Knight Frank (India) Pvt Ltd.

Moneylife had earlier reported (http://www.moneylife.in/article/78/2292.html) on how inventories are piling up with developers in Mumbai and Delhi and they are unable to clear their stock. “As for the quarter ended March 2010, prices have gone up further by 15%-20% and we are estimating sales to be down further by 25%-30%. Property prices are (now) indicating the rise of another asset bubble,” said Pankaj Kapoor, founder, Liases Foras.