Despite correction, gains unlikely for realty stocks in the near term

The key trigger for the sector and listed companies are trends in housing sales. Data on this front does not look favourable

The Nifty Realty has been one of the weakest sectoral performers over the past year. While the benchmark Nifty 50 slipped 6 per cent, the real estate index fell 22 per cent during the same period. Godrej Properties led the decline, losing 40 per cent of its value, followed by Brigade Enterprises, which was down 33 per cent. 

Unless the festival season brings a surprise lift, the slump is likely to persist. Third-quarter (Q3) housing sales volumes have dropped 9 per cent, prices have climbed sharply, affordability has eroded, and the job market remains weak. 

The sector’s outlook hinges on