While housing sales in India recorded a decline in Q2 FY20, the housing sales value of India’s top 9 listed developers stayed on course during the quarter.
Category: Real Estate
The IT capital Bangalore has the lowest unsold inventory overhang at about 15 months while NCR has the highest at 44 months as on Q3 2019.
Sanjay Chugh, City Head – Chennai, ANAROCK Property Consultants
Today, a city’s real estate success formula depends on quite a few other industries than just housing. Housing demand is a natural by-product of the success of businesses and industries that drive consumption and create jobs.
Chennai’s strengths as an automobile hub have already earned it the tag of ‘the Detroit of the East’, but it has also emerged as one of the leading IT/ITeS destinations of the country.
Both these industries drive job growth, which in turn drives housing demand, but there are at least two other industries that share a deep symbiotic relationship with Chennai’s overall real estate viability – the organized retail and warehousing & logistics sectors.
Shopping Malls
An economic downturn or no economic downturn, Indians love to shop.
Some consumer items like cosmetics (the fabled ‘lipstick effect’), fast fashion and electronics like Smartphones are actually beating the current trends, with the growth figures in these industries still firmly in the green.
Malls are the best places to shop for these – and to enjoy a few hours in clean,
The Indian government will contribute INR 10,000 crore to provide last-mile funding requirements for stalled housing projects that are non-NPA and non-NCLT.
South Mumbai's Tardeo is India’s most expensive luxury residential location in the primary (first sale by the developer) residential real estate market.
The Indian festive season, ushered in by Ganesh Chaturthi, has begun and the government has already sweetened the deal for homebuyers.
When it comes to unsold housing stock, NCR has been in the limelight and the Millennium City, Gurgaon, tends to be a focal point for such analyses.
- Only 7,620 units in 23 projects had subvention schemes – a mere 11% of the total 69,000 units launched across top cities
- Leading developers with sound financial backing outnumbered smaller players in taking a hit from NHB’s recent curb on subvention schemes
- MMR topped the list with 17 projects, followed by Bangalore with 4 projects and 1 each in NCR & Pune
- No projects in Kolkata, Hyderabad & Chennai offered any subvention schemes
- 5:90:5 was the most common scheme on offer to homebuyers
Mumbai, 19th August 2019: The National Housing Board’s (NHB) recent directive to housing finance companies to refrain from giving loans under subvention schemes was not as crippling as was initially assumed.
ANAROCK research reveals that out of the total 280 projects launched in the April-June quarter of 2019, only about 23 projects (or 8%) were marketed under subvention schemes. These 23 projects comprised of 7,620 units – about 11% of the total 69,000 units launched in the quarter.
Anuj Puri, Chairman – ANAROCK Property Consultants says,
- New supply of homes priced >INR 1.5 Cr stood at 16,100 units in H1 2019 against 5,240 units in H1 2017 (period immediately post DeMo)
- In H1 2017, luxury supply in most cities fell to three-digit numbers; NCR & Pune saw minimal launches – merely 140 units collectively
- Expensive markets MMR & NCR together comprise 59% share of new luxury stock in H1 2019 – 6,490 units & 3,030 units respectively
- Over 9,940 units in H1 2019 added in price budget of INR 1.5 – 2.5 Cr, remaining 6,160 units added in >INR 2.5 Cr budget
- Of the total 6.65 lakh unsold units in top 7 cities in Q2 2019, approx. 86,430 units are in the luxury category (priced >1.5 Cr)
Anuj Puri, Chairman – ANAROCK Property Consultants
Along with the resale homes market, luxury housing took the hardest hit after demonetization. The Government’s continued focus on affordable housing coupled with the surgical strike on high-value currency denominations in November 2016 took the sheen off luxury housing for two years in a row.
Anuj Puri, Chairman – ANAROCK Property Consultants
The hard facts of declining consumption and a deepening economic slowdown in India are inescapable, and real estate has been severely impacted by them. To this gloomy backdrop, the RBI’s repo rate cut of 35 bps to 5.4% announced in the latest monetary policy is obviously welcome.
This rate cut, the fourth consecutive cut since February 2019, is meant to boost consumer sentiments once commercial banks transmit the benefits to actual consumers.
For real estate, a rate cut of 35 bps is however insufficient to significantly improve buyer sentiment in the mid-income segment, which still has a staggering unsold inventory of 2.17 lakh units in the top seven cities. On the other hand, demand for affordable housing, which accounted for 2.40 lakh unsold units in these cities, may see improvement as this highly budget-sensitive segment already has the benefit of other incentives.
Even minor downward revisions in interest rates can and do make a difference in affordable housing. If banks transmit this reduction in the prime lending rate to consumers, budget housing demand may improve. Likewise, housing demand in tier 2 and tier 3 cities,