T
he real estate industry is facing a crisis, with sales plummeting and sentiment crushed by the oversupply of homes meeting the battered stock market. Builders are struggling to cope, despite strong registration data that seems hollow in reality. The foundation for this crisis was laid in 2021 when Mumbai's municipal corporation offered builders a sweetener to rescue the industry - a 50% discount on construction fees. However, this led to an oversupply of luxury apartments at high prices and a lack of differentiation among products.

    The result is a market where buyers are spoilt for choice, with little to distinguish one project from another. Decision-making time has increased, and builders are resorting to discounts and payment plans to attract buyers. This strategy is doomed to fail, as it's based on minor down payments and high prices that will eventually be cut publicly.

    Homebuyers should approach the market with caution, evaluating every option carefully over a period of 3-4 months. They should monitor construction progress and eliminate projects with poor execution. While price is important, it shouldn't be the sole determining factor - buying the cheapest home can be the most expensive mistake. A builder's reputation is crucial, as many have learned to game the RERA system.

    Real estate is not an investment, and theories suggesting a falling stock market will drive investors into real estate are misguided. Safe projects are priced high, while unsafe ones are vulnerable like small-cap stocks. Ultimately, buyers should purchase a home for the right reasons, with thorough research, and the right counterpart - as their financial health is linked to the builder's reputation.