Realtors cut prices as their sales plunge

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Jubair Hasan and Sonia H Moni Sale of apartments has declined by more than 50 per cent over the last two years, prompting realtors to reduce the prices of their unsold flats -- thus attracting buyers with lucrative offers. Realtors say they have increased the rate of discount up to 20 per cent to bring dynamism to the struggling industry with over 20,000 ready flats being added to the list of 16,000 unsold apartments from early next year. The developers fear that the industry may face closure in the coming days if the government does not give special attention to the around Tk 200 billion's worth industry, which has witnessed poor sales since 2009 when the government stopped providing fresh gas and electricity connections for domestic use. The realtor community said their sufferings have further intensified after the recent debacle in the country's stock markets as many of the prospective consumers have lost almost everything they had in the capital market crash. "We're now attracting customers with different catchy offers like discount, raffle draws and gift items-on-booking with a view to increasing the number of sales," Real Estate Housing Association of Bangladesh (REHAB) general secretary Murad Iqbal Choudhury told the FE. "We actually don't know the future of the sector. We're now in a catastrophic state," he said, adding that a number of other sectors like cement, iron, rod, brick and sanitary fittings are also linked to the industry. "We have been forced to decrease the prices of apartments to sell our unsold flats and plots," Sheltech managing director Toufiq M Seraj said. Sheltech, a pioneer of the industry, would give 15 per cent discount on instalments and 20 per cent discount for full payments. "This is the highest ever discount rate the company has declared," he added. According the offer, the price for per square feet has come down to nearly Tk 16,000 from Tk 21,000 in the city's posh areas like Dhanmondi and Gulshan. The realtors have also offered raffle draws and expensive gifts to the participants in the growing numbers of real estate fairs only to draw the attention of the customers. "Even we do not have financial support from the commercial banks due to the ongoing liquidity crisis," chairman of Index Development Ltd Abdur Rahim Khan said, adding that those who want to 'invest' in the sector demand exorbitant rates of interest up to 18 per cent. "We've sold only four apartments in the current year against 40 that was recorded in 2010," Mr Khan, also the vice president of REHAB, said. Managing Director of Building for Future Limited Tanveerul Haque Prabal, ex-president of REHAB, said his company had experienced more than 50 per cent fall in sales over the last 12 months. The government should allow undisclosed money again to come in the sector like in the share market for the survival of the industry, the former REHAB president said. The realtors have also started terminating its employees to reduce expenditure under the changed circumstances. The authorities of Mega Builders Limited have recently sacked a number of its employees from its headquarters. REHAB sources said the investment of Tk 76.80 billion of the realtors remain stuck up for the latest government provision of conditional power and gas connections, while both buyers and developers have long been paying bank interests worth Tk 890 million per month.