How realty fared across In­dia in the fes­tive sea­son of2018?

The on­go­ing liq­uid­ity cri­sis in In­dian realty could, to come ex­tent, play spoil­sport for de­vel­op­ers this fes­tive sea­son

Hindustan Times (Chandigarh) - Estates - - HT ESTATES - Anuj Puri let­[email protected]­dus­tan­ The au­thor is Chair­man – ANAROCK Prop­erty Con­sul­tants

It is still too early to pro­vide hard num­bers of 2018 fes­tive sea­son’s prop­erty sales num­bers as it is yet to con­clude. Also, sales num­bers are usu­ally col­lated by the end of the fourth quar­ter. How­ever, trends in re­cent years sug­gest that the en­tire fourth quar­ter of the cal­en­dar year is seen as an aus­pi­cious time wherein hous­ing sales rise. Con­sid­er­ing the q-o-q trends in 2018, sales num­bers have in­creased across the ma­jor cities. For in­stance, hous­ing sales in Q3 2018 in­creased by 9% as against the pre­ced­ing quar­ter. In com­par­i­son to Q3 2017, sales in­creased by 15% in a year across the top 7 cities. If we go by th­ese num­bers and look at the cur­rent sce­nario, we can ex­pect sales to go up by 9-12% in Q4 2018 (the fes­tive sea­son quar­ter) as against Q3 2018. How­ever, the on­go­ing liq­uid­ity cri­sis in In­dian real es­tate could, to come ex­tent, play spoil­sport for de­vel­op­ers this fes­tive sea­son. While sales num­bers have been in­creas­ing q-o-q, there is no sig­nif­i­cant change noted in the num­ber of in­quiries seen dur­ing this fes­tive sea­son so far. This, how­ever, varies from city to city. For in­stance, in Ben­galuru, Di­wali is usu­ally the time when site vis­its and in­quiries see a dip as most peo­ple liv­ing there are migrants who re­turn to their home­town to cel­e­brate the fes­ti­val with their fam­i­lies.


As is ex­ten­sively known, the realty mar­ket of Delhi-NCR has been one of the worst-af­fected in the coun­try amongst other prom­i­nent cities post the slow­down due to re­for­ma­tory changes in­clud­ing DeMo, RERA and GST. While other cities in­clud­ing Ben­galuru and MMR have gained sig­nif­i­cant mo­men­tum with the dust of th­ese poli­cies fi­nally set­tling in, Del­hiNCR is yet to come any­where close to its peak lev­els.

One of the ma­jor chal­lenges hound­ing NCR is the is­sue of stalled projects that has pri­mar­ily been at the core of buy­ers’ dis­con­tent. The other key rea­sons for the chronic project de­lays in NCR in­clude:

· The cash crunch re­sult­ing from de­vel­op­ers si­phon­ing off funds for other projects (or even other pur­poses)

· ‘Tweaked’ project de­tails to by­pass en­vi­ron­men­tal/reg­u­la­tory clear­ance norms

· Con­stantly chang­ing reg­u­la­tions

· The wa­ter and sand cri­sis, and

· Bu­reau­cratic quag­mire en­coun­tered in project clear­ances

Nev­er­the­less, if we con­sider q-o-q trends in 2018, the uptick in new supply and ab­sorp­tion num­bers in NCR can bring in some respite to builders and buy­ers alike. More­over, the rel­a­tively re­stricted new supply - com­pris­ing of a mere 3,770 new units dur­ing the fes­tive sea­son in Oc­to­ber 2018 - is likely to bode well for NCR’s realty mar­ket and pos­i­tively im­pact the hous­ing sales there dur­ing this pe­riod.

As per ANAROCK data, the over­all hous­ing units sold in NCR in first three quar­ters of 2018 was nearly 31,570 units, ac­count­ing for nearly 18% of the to­tal sold stock (1,78,455 units) across the top 7 cities. Of the to­tal sold units, Greater Noida saw the max­i­mum hous­ing sales with 9,820 units sold, fol­lowed by Gur­gaon with 8,370 units sold, Ghazi­abad with 4,805 units, Noida with 4,300 units and Farid­abad with 1610 units sold (ap­prox­i­mately)

De­spite the many is­sues plagu­ing the NCR real es­tate mar­ket, the re­gion has seen a de­cent de­cline of 9% in its un­sold stock in a span of one year – from 2,09,430 units in Q3 2017 to 1,90,650 units in Q3 2018. This even­tu­ally bodes well for a mar­ket where sales were at best tepid in 2017.

From the de­mand per­spec­tive, ANAROCK’s H2 2018 con­sumer sen­ti­ment sur­vey in­di­cates that more than 40% prospec­tive buy­ers in Delhi-NCR are look­ing to buy a prop­erty within this year. If this comes true, then builders in the re­gion would have had rea­sons for some real fes­tive spirit this Di­wali. Ready-to-move-in prop­er­ties are def­i­nitely the flavour of the sea­son with nearly 48% home seek­ers in NCR pre­fer­ring th­ese over un­der con­struc­tion op­tions.

If we deep dive, out of the to­tal 200,000 units stuck in var­i­ous stages of (non) com­ple­tion in en­tire NCR since their launch in 2013 or be­fore, as many as 1,30,000 units be­long to Noida and Greater Noida com­bined - a mas­sive 65% of the en­tire stuck in­ven­tory in NCR.

As per ANA ROCK data, out of the to­tal units launched across the top 7 cities (nearly 1,40,000) from Jan­uary till Septem­ber 2018, NCR ac­counted for merely 12% of the to­tal new stock with ap­prox. 17,220 units launched dur­ing the pe­riod. Of this to­tal supply, Gur­gaon and Greater No ida com­prised max­i­mum new launches with nearly 11,060 new units, fol­lowed by Ghazi­abad with 3,030 units ap­prox.

Out of the to­tal new units launched, nearly 42% be­longed to the af­ford­able cat­e­gory, fol­lowed by 26% of the units launched in the mid seg­ment( Rs. 40 - 80 lakh). The re­main­ing 32% be­longed to the lux­ury and ul­tra­lux­ury cat­e­gories com­bined.


ANA ROCK data in­di­cates that as many as 1,78,470 units have been sold in the first three quar­ters of 2018 across the top 7 cities.

As per trends, max­i­mum ab­sorp­tion in the first three quar­ters of 2018 was in the af­ford­able and mid seg­ment (up to Rs. 80 lakh) com­bined across the top 7 cities, com­pris­ing more than 75% of the over­all hous­ing sales. The re­main­ing con­sisted of lux­ury and ul­tra-lux­ury prop­er­ties priced above Rs. 80 lakh.

Av­er­age Prop­erty Price Change - Oc­to­ber 2018 and Oc­to­ber 2017

The av­er­age na­tional prop­erty price of the top 7 cities at the end of Oc­to­ber 2018 was Rs. 5,546 per sq. ft., while in the cor­re­spond­ing pe­riod in 2017 it was Rs. 5,485 per sq. ft.

Out of the to­tal new supply across the top 7 cities from Jan­uary to Oc­to­ber 2018 (1,55,800 units ap­prox.), af­ford­able seg­ment com­prised of nearly 40% that saw launch of 62,160 units ap­prox. dur­ing the same pe­riod. In con­trast, in 2017 as many as 46,920 units ap­prox. were launched in the af­ford­able cat­e­gory dur­ing the same pe­riod.


The realty mar­ket of Delhi­NCR has been among the worst­af­fected in the coun­try

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