DLF To Increase Prices Across Residential Products Portfolio

Although the real estate developer did not specify which products would face a price increase, it did say that the increase will be more minor than 5% in the current fiscal year.

Because separate floors and luxury homes are in high demand, DLF plans to raise prices selectively across its residential sector once more. Between November last year and March 2021, the company hiked pricing on independent floors in Gurgaon three times and eliminated some Camellia reductions.

Although the real estate developer did not specify which products would face a price increase, it did say that the increase will be more minor than 5% in the current fiscal year. DLF is planning to renovate its premium and mid-income housing, attracting homebuyers' attention for the past eight to twelve months.

DLF said on Tuesday during its quarterly earnings call that it is "looking" at raising pricing "selectively" across its residential product line, depending on market demand. On a weighted average basis, the price increase could be "around 5%," which the company plans to maintain in FY22. In its Q1 FY22 earnings presentation, the company also stated that it is looking into a "judicious pricing rise in line with market acceptability."

In November of last year, DLF released standalone floors in Phase-3 (Gurgaon) for Rs 11,000 per sq ft. Prices were hiked to Rs 12,500 per sq ft in February 2021, representing a 14 percent increase on a like-to-like basis between November 2020 and March this year.

Phase 1 of the project began in March 2021, with individual floors priced at roughly Rs 15,000 per sq ft. The rally, however, was fueled mainly by the project's advantageous position, according to the statement. DLF has also reduced discounts on ultra-luxury apartments, Camellias, by 4-5 percent, resulting in a higher recovery of Rs 1,500-2,000 per sq ft.

The company said it received a positive response on separate floors throughout DLF city and New Gurgaon, demonstrating that it is in high demand. In Q1 FY22, sales bookings for new items, including a planned development in Gurgaon, were Rs 542 crore for 0.5 million sq ft (MSF). It has reserved 1.3 million square feet of space in the project, which spans 1.5 million square feet.

Camellias have been in high demand for a long time. It claimed a sales booking of Rs 330 crore for 0.1 MSF in April-June. It has a total size of 3.6 million square feet, of which 2.4 million square feet have been reserved thus far. In the last four quarters, the housing project has consistently sold in the double digits.

In the second part of FY22, DLF will begin taking reservations for its flagship premium luxury property, Midtown in central Delhi. The company is now working on RERA permissions for high-rise condos. The project is 8 MSF in size, with 2.1 MSF delivered by H2 FY22 and 6 MSF delivered after FY24. The full sales potential of Midtown is between Rs 12,000 and Rs 15,000 crore.