Un­sold units across In­dia

HT Estates - - HTESTATES -

have been weeded out of the mar­ket in the last two years. The huge avail­abil­ity in the sec­ondary mar­ket is a clear in­di­ca­tion of this.

As per Knight Frank’s pro­jec­tions, all the top eight residential mar­kets are an­tic­i­pated to wit­ness a slight im­prove­ment in sales dur­ing the sec­ond half of 2015. Yet, the yearly sales in 2015 will fall be­hind that of 2014 across all mar­kets, bar­ring Pune.

NCR comes across as the most af­ford­able mar­ket among the top eight cities in In­dia, as 57% of all the new launches in the first half of 2015 were be­low the ticket size of ₹ 2.5 mn. How­ever, this share is skewed due to the large num­ber of units launched in Gur­gaon un­der the Haryana Gov­ern­ment’s af­ford­able hous­ing scheme.

Ben­galuru wit­nessed the l east num­ber (2%) of new launches in the af­ford­able cat­e­gory (ticket size less than ₹ 2.5 mn). That mar­ket also had the high­est num­ber of pro­ject launches in the ₹ 5 to ₹ 7.5 mil­lion ticket size.

De­spite hav­ing a rel­a­tively low weighted av­er­age price of ₹ 3,500 per sq ft, Hy­der­abad wit­nessed only 4% of the new launches be­low the ticket size of ₹ 2.5 mil­lion in the first half of 2015. Nearly half of all the new launches in Mum­bai in the first half of 2015 were be­low the ticket size of ₹ 5 mil­lion. This, de­spite the fact that Mum­bai has the high­est weighted av­er­age price, at ₹ 7,900 per sq ft. The quar­ters to sell un­sold in­ven­tory (QTS) is the num­ber of quar­ters re­quired to ex­haust the ex­ist­ing un­sold in­ven­tory in the mar­ket. The ex­ist­ing un­sold in­ven­tory is di­vided by the av­er­age sales ve­loc­ity of the pre­ced­ing eight quar­ters in or­der to ar­rive at the QTS num­ber for that par­tic­u­lar quar­ter. A lower QTS in­di­cates a health­ier mar­ket.

As per Knight Frank’s mar­ket health anal­y­sis, Mum­bai has the high­est num­ber of un­sold units in In­dia, at more than 194,000 as of June 2015. How­ever, the NCR mar­ket will take the max­i­mum time to liq­ui­date its ex­ist­ing un­sold in­ven­tory. At the cur­rent pace of sales, NCR will take more than four years to ex­haust the un­sold homes com­pletely.

Pune is cur­rently the health­i­est mar­ket, with the low­est QTS and a rel­a­tively lower age of un­sold in­ven­tory. The Kolkata mar­ket has a QTS com­pa­ra­ble to that of Mum­bai de­spite hav­ing one of the low­est un­sold in­ven­tory lev­els in com­par­i­son to the other mar­kets. This can be at­trib­uted mainly to the re­duc­ing pace of sales, es­pe­cially in the pre­mium cat­e­gory.

De­spite hav­ing the least un­sold in­ven­tory, Hy­der­abad cur­rently has a high QTS and also suf­fers with a very high age of un­sold in­ven­tory. A large num­ber of pre­vi­ously-launched projects still re­main un­sold in the city. One of the rea­sons for such a high age of in­ven­tory is the fact that home­buy­ers in this mar­ket pre­fer ready-to-move-in prop­er­ties; hence, a num­ber of sales ma­te­ri­alise once the pro­ject is ready for pos­ses­sion.

PHOTOS: HT PHOTO

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