Real Estate sector struggle continued in Q2 FY’18: PropTiger; Experts Differ

iBy Accommodation Times Bureau

National, October 26, 2017 – PropTiger. com, part of Elara Technologies Pte Ltd which also owns Housing. com and Makaan. com, today released the findings of its ‘Realty Decoded Report’ for the Q2’FY 18 (July-September). As per the report, Mumbai and Gurugram have shown improvement in both new launches and sales in Q2 FY’18. The key driver for increased new launches in Gurugram and Mumbai is the affordable housing launches under Haryana Affordable Housing Policy 2013 and timely implementation of RERA in Maharashtra respectively. Due to improved buyer confidence, Mumbai and Gurugram recorded an increase in sales by 6% and 60% respectively over Q2 FY’17.

Pankaj Kapoor, CEO , Liases Foras, one of oldest research house differ the statements made in the report. In his communication to this paper he said that Our numbers are different. I don’t agree.

Experts in the industry are optimistic. Niranjan Hiranandani, National President NAREDCO said that Tsunami effect has gradually slow down,buyers are out again,offered with better choices of their dream home in festive sentiments.

According to the report, RERA, though applicable since May 2017, was not implemented in many key states such as Karnataka, Haryana, Telangana, Uttar Pradesh till the middle of July 2017 which had a major impact on new launches. New launches dropped by 53% in Q2 FY’18 as compared to Q2 FY’17. A major drop in launches was seen in cities such as Ahmedabad, Hyderabad, Chennai and Kolkata where new launches are ~10% of new launches in Q2 FY’17.

 

The study covered nine key Indian cities of Mumbai, Pune, Noida, Gurugram, Bengaluru, Chennai, Hyderabad, Kolkata and Ahmedabad.

 

 

Launch Volume(Units)

Sales Volume (Units)

City

Q2 FY’17

Q2 FY’18

% Change

Q2 FY’17

Q2 FY’18

% Change

Ahmedabad

6,752

581

-91%

4,128

2,222

-46%

Bengaluru

5,647

2,363

-58%

9,557

6,976

-27%

Chennai

4,192

381

-91%

3,849

2,945

-23%

Gurugram^

1,331

2,460

85%

2,090

3,342

60%

Hyderabad

3,492

383

-89%

4,105

3,356

-18%

Kolkata

8,027

675

-92%

3,778

2,993

-21%

Mumbai**

8,084

9,584

19%

11,462

12,101

6%

Noida*

2,192

1,084

-51%

5,104

3,606

-29%

Pune

7,315

4,604

-37%

10,648

7,214

-32%

TOTAL

47,032

22,115

-53%

54,721

44,755

-18%

             
           
Source: Proptiger DataLabs Sep ’17        
Notes: * Noida includes Greater Noida and Yamuna Expressway.  
            ** Mumbai includes Navi Mumbai and Thane.    
            ^ Gurugram includes Bhiwadi, Dharuhera and Sohna.  
            Analysis includes apartments and villas across the regions  

 

Commenting on the report, Ankur Dhawan, Chief Investment Officer, PropTiger.com said: “The new RERA and GST regime impacted launches as well as sales in the second quarter of FY’18. However, sales showed a marked improvement in September over July and August, driven by festival offers launched by most developers. Though the last quarter looks sluggish, the long term story for residential market remains strong. With effective implementation of RERA, we expect growth of 30 to 40% on year on year basis in sales and new launches in the next quarter.”

 

According to the study, sales of ready to move in units has shown annual growth rate of 21% year on year reflecting the increased preference of buyer for these units as they are out of ambit of RERA and GST.

 

The other key highlights of the latest report are as follows:

 

  • Sales showed a marked improvement in September over July and August, driven by festival offers launched by most developers. Festival offers worked very well in Mumbai, Pune and Bangalore but could not yield similar results in Noida, Chennai and Hyderabad

 

  • Share of affordable housing again crossed 50% mark in Q2 FY’18; units which were priced in the budget of <50 Lakhs contributed > 50% in new launches as well as in sales

 

  • Reduced sales has pushed inventory overhang to 42 months of unsold stock. Hyderabad and Gurugram have the lowest inventory overhang at the end of Q2 FY’18

 

  • Kolkata and Ahmedabad have more than 70% of the unsold inventory in the <50 Lakhs segment followed by Pune

 

  • Gurugram witnessed highest price appreciation followed by Mumbai and Hyderabad




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