ICICI Securities through it’s quarterly Real Estate update, Real Estate Pulse – Volume II, has given an insight into the underlying sentiment prevailing among individual home buyers/brokers and the demand and supply dynamics across eight major Indian cities such as, Mumbai, Delhi/NCR, Bangalore, Chennai, Kolkata, Ahmedabad, Pune & Hyderabad and has interpreted buyer sentiment and its variations juxtaposed with the demand-supply matrix and has highlighted the key trends and a better understanding of the overall Indian Real Estate market.
The review is based on an online survey of 3,839 respondents, An offline survey of 2,044 respondents spread across 25 indian cities with various income levels & employment categories and one to one interactions with almost 84 brokers India within the period from June 2010 to July 2010.
It also includes the Demand and supply data from the ICICI Home Finance Division from across the country.
The main highlights of this update are,
The buyers are anticipating a positive price trend. As per these respondents, the property prices are expected to rise within next 12 months, though they perceive current prices to be high.
Affordability doesn’t seem to be much of a concern. A healthy demand is existing for homes even at the current prices.
They are at an inflection point and can convert demand into transactions. Indian buyers are conservative on the ticket size, with buyer intended home price-to-household income ratio at 3.3x.
Buyers are primarily the end users, with maximum demand in the price range of Rs1.5 – 4.5mn; buyers are getting comfortable with the leverage.
Brokers are of the opinion that queries for the housing have increased significantly. Maximum enquiries are being witnessed for Affordable housing segment . Almost 75% of the brokers have seen increased queries for affordable housing. There are also a good no. of enquiries for premium housing segment and has picked up well . Most believe that prices have increased in the past three months and will continue to increase over the next six months. Mumbai & National Capital Region (NCR) are witnessing the maximum increase in such enquiries.
The Demand-supply analysis at cities like Mumbai, Bangaluru, NCR, Kolkata & Pune continue to look healthy, while the Hyderabad market is still struggling.
The Indian Property Market seems to be positive especially in case of Mumbai and Bangalore. HDIL, SOBHA & DLF are the preferred developers and healthier price realisations and sales in the medium term are expected.