Mumbai, Mar 1 (PTI) With the property market in the country witnessing momentum on account of lower interest rates and various government incentives, developers should ensure that real estate prices do not appreciate much which could hit demand, feel experts.

Over the past few months, home sales have surged in few regions, including in Mumbai, driven by lower interest rates and cut in stamp duty.

“This is a huge opportunity we are sitting on as all the forces are in our favour. My biggest concern is - don't let (property) rates go up. Please don't get carried away with pricing. I am told (property) prices in Mumbai have already started moving up,” HDFC Ltd Managing Director Renu Sud Karnad said.

She was addressing real estate developers at an event organised by National Real Estate Development Council (Naredco) on Monday.     Karnad warned that though a lot of confidence has slowly started coming back into the market and people are buying properties, the fear of projects not getting completed is still huge and does exist.

She said one should not just look at the numbers indicating higher disbursement or sanction of home loans by the lenders or a rise in housing sales in a particular market, as it could be transitory and could be the result of the government incentives such as the reduction in stamp duty.

“…Government benefits are not going to be there forever. Let us not get carried away by trying to make that extra bit,” she urged.      Echoing her views, Tata Capital Managing Director and CEO Rajiv Sabharwal said developers should not increase the prices as it could pose a big risk.

“We have to ensure that we don't do anything so that the prices go up. It is very important that the price per square foot, at which properties are being leased, don't move up sharply,” Sabharwal said.     He said Maharashtra has taken a number of steps to ensure that transaction cost and cost of creating property are kept low, and these measures should continue over a longer period of time.

According to Sabharwal, the government should not suddenly stop the incentives that have been given to the real estate sector.

"They (the government) should not believe that we (real estate sector) are out of the woods and that all the benefits should be taken away. We can call the sector to be out of the woods if we have seen growth for two-and-a-half to three years. These benefits should continue for 2.5-3 years," he added.

Karnad said the Reserve Bank of India's restructuring and moratorium measures have provided much relief to all the stakeholders in the sector.

She urged developers to get organised in repayments once restructuring or any other benefits are being extended to them by lenders.

“Once you have rescheduled your loan, make sure that it doesn't become an NPA,” she said.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)