Reality bit realty space bad in 2011 but better times ahead

Real estate developers are waiting for them to be put of the misery that 2011 doled out to them. The sector has not just had to grapple with a loss of reputation with its alleged link to the 2G scam, but also dwindling sales and funding constraints. Priyanka Ghosh of CNBC-TV18 wraps up the year that was.

February 9, 2011 was a day that real estate sector is unlikely to forget... Not just because DB Realty promoter Shahid Balwa was arrested for his alleged links with the 2G scam, but also because this event cost the real estate sector its reputation.
With directors of three leading players behind bars for most of the year, an already cash-strapped industry woke up to banks and investors becoming doubly cautious and tightening their purse strings. Add to that a huge drop in sales due to mounting interest rates which hurt both, cash flows and customer demand, and launches came to a grinding halt.
Mumbai was the worst affected. Other markets like Bangalore and NCR continued to see sporadic sales. But even here, the trend was definitely downward.
Muddling through the issues that plagued the sector, developers nonetheless continued to hold on to prices. Says Anuj Puri, chairman and country head, Jones Lang LaSalle,