As the festive season unfolds, real estate developers across India’s top seven cities are holding firm on pricing, offering minimal discounts or incentives, particularly in the affordable and mid-segment markets. This cautious approach marks a shift from previous years, where hefty discounts were commonplace to boost sales.

Stability in Pricing Amid Low Inventory

Market analysts indicate that the current low inventory levels in the affordable and mid-range segments are a primary factor preventing developers from offering significant discounts. Despite experiencing slower sales in these categories during the last quarter, developers are not feeling pressured to incentivize purchases.

According to industry experts, typical incentives seen in past festive seasons, such as substantial price reductions or promotional gifts like gold coins and home appliances, are largely absent this year. Instead, the focus has shifted to streamlined payment plans that align with construction progress.

Evolving Incentives: A Shift Toward Payment Plans

With sales remaining robust in the luxury sector, many developers are prioritizing stability over aggressive marketing tactics. Rather than slashing prices, they are introducing flexible payment structures that can ease financial commitments for buyers. These strategies may involve partial upfront payments followed by a payment holiday or construction-linked payments, allowing buyers to pay as their new homes are built.

Exhibitions Reflect Market Sentiment

At the recent NAREDCO Homethon 2024 property exhibition in Mumbai, developers largely showcased premium and luxury offerings without significant discounts. Many participants acknowledged the challenges in the mid and affordable segments, citing declining profit margins that make large discounts impractical. Despite a slowdown in inquiries for these categories, developers remain optimistic about the long-term value of their offerings.

Market Trends: Diverging Performance Across Segments

Recent data from property consultancy Knight Frank highlights a 13 percent year-on-year decline in sales for the mid-segment and a 14 percent drop for affordable homes priced below Rs 50 lakh. In contrast, major players like Macrotech Developers and Godrej Properties, who have pivoted towards premium and luxury markets, reported record-breaking pre-sales figures, illustrating a clear divide in market performance.

As the festive season progresses, it remains to be seen whether developers will adapt their strategies in response to market dynamics or maintain their current course in this evolving landscape.