Indian central bank says property prices must fall
Sellers of property in India may revise prices downwards to get rid of mounting inventories, according to reports. Due to mounting house prices, many potential buyers have been unable to join the market and as a result, developers have been left with large amounts of unsold properties.&nbsp;Reserve Bank Governor, Raghuram Rajan, had said recently that there was a need for developers to bring down prices to spur demand, instead of asking the central bank to cut interest rates.&nbsp;
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Property prices may see a correction during Diwali, to get rid of mounting unsold inventories, property dealers have said. Property prices have been peaking, making houses out of reach for most buyers.

Due to this, demand for real estate has been stagnating. However, despite this, there has been no real revision in prices to bring buyers into the market again.

Reserve Bank Governor Raghuram Rajan had said at the SBI Conclave recently, that there was a need for realty developers to bring down prices to spur demand, instead of asking the central bank to cut interest rates.

According to a RBI annual report, home buyers have shied away from buying due to prices beyond their reach, which in turn has led to increase in the number of unsold properties and also fall in number of new launches.

Real estate players say they now have about 48 months worth of unsold inventory, which is considered high. In such cases, instead of bringing down prices, the real estate industry depends on the central bank to lower interest rates.

According to a survey by industry body Assocham, the National Capital Region residential market is stuck with an estimated inventory of 1,70,000 units. Similarly, data compiled by property advisory JLL India and Confederation of Real Estate Developers Association of India (Credai) estimates 77,460 unsold residential units across Mumbai, Thane and Navi Mumbai.

Real estate experts says that on the back of these huge unsold properties, their is scope for lowering prices, especially in Mumbai and Delhi NCR.

Sunil Mantri, chairman, Mantri Realty, said that developers are already providing different schemes and offers and further 10% discount or price correction on an average is expected with the festive season round the corner, an Asian Age report has said.

"Across the country, developers are trying to reduce inventory and want to offer attractive discounts to lure customers", he added.

However, the chairman and managing director of Raheja Developers, Navin Raheja believes that any more price cuts are not possible.