NCR sees 43% drop in home sales

2014 not great for In­dian real es­tate, fall sharpest in NCR, says re­port

HT Estates - - FRONT PAGE - Van­dana Ram­nani

Res­i­den­tial sales d r o p p e d by 1 7 % across Mumbai, Delhi Na­tional Cap­i­tal Re­gion ( NCR), Ben­galuru, Pune, Chen­nai and Hy­der­abad with NCR see­ing the sharpest drop in home sales that was as high as 43%. The year 2015 will be the year of re­cov­ery and sta­bil­i­sa­tion, ac­cord­ing to a Knight Frank In­dia Real Es­tate Out­look.

“2014 has not been a great year for In­dian real es­tate. It re­flected a cor­rec­tion in stake­holder sen­ti­ments on the back of a slow­ing d e m a n d e nv i r o n m e n t . Res­i­den­tial sales across the top cities have dropped in 2014. While sales vol­umes fell by 17%, launches dropped by 28%,” says Shishir Baijal, chair­man and man­ag­ing direc­tor, Knight Frank In­dia.

Ac­cord­ing to the re­port, NCR wit­nessed the sharpest fall in sales vol­ume among all the six cities. Prop­erty sales fell by 43% year- onyear in NCR in 2014, fol­lowed by Hy­der­abad with 18%. Sales in Pune and Chen­nai de­clined by 10% and 14%, re­spec­tively, Mumbai by 9% and Ben­galuru by just 3%.

New launches also saw a de­clin­ing trend. They fell by 43% in Mumbai, fol­lowed by Hy­der­abad that saw a 30% drop. NCR saw a de­crease of 24% in the num­ber of project launches in 2014 com­pared to 2013, Ben­galuru 13%, Pune 26% and Chen­nai 25%.

A se­vere fall in sales has re­sulted in a huge in­ven­tory pile-up with real es­tate de­vel­op­ers. The NCR has 192,568 un­sold res­i­den­tial units which will take ap­prox­i­mately 14 quar­ters to sell (QTS); it means that if no fur­ther units are added, the cur­rent in­ven­tory will take 14 quar­ters to get sold. QTS is a ra­tio cal­cu­lat­edu­lated on the ba­sis of av­er­age age sales for the last eight quar­ters di­vided by the out­stand­ing­stand­ing units on sale.

Mumbai has ap­prox­i­mately 12 quar­ters of in­ven­tory, fol­lowed by Hy­der­abad with close to eight quar­ters and Pune, and Chen­nai and Ben­galuru with seven quar­ters each.

“We ex­pect 2015 to be the year of re­cov­ery and sta­bil­i­sa­tion. The cur­rent eco­nomic in­di­ca­tors look pos­i­tive, though the real im­pact will only be felt by the sec­ond half of this year. A sur­prise rate cut from RBI has marked the be­gin­ning of the New Year and go­ing for­ward, the Make in In­dia cam­paign, REITs, FDI re­lax­ation, and smart c i t i e s, a m o n g o t h e r s, au­gurs well for giv­ing a much- needed boost to stake­holder sen­ti­ments,” Baijal said.

The of­fice space seg­ment, how­ever, perf or med well dur­ing the year on the back of re­cov­ery in the do­mes­tic mar­ket.

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.