According to Liases Foras, overall volumes were down 1 per cent year over year (YoY) at 68,225 units and down 2 per cent on quarter over quarter (QoQ) in Q4FY19. The national capital region (NCR) market was lagging, with volumes declining 21 per cent YoY while the Mumbai metropolitan region (MMR) and Pune saw a YoY decline of 2 per cent and 6 per cent, respectively.
“While the MMR market is reeling under high prices, which is affecting demand in Mumbai city/suburbs, the peripheral micro-markets of Thane, Kalyan-Dombivali, and Navi Mumbai (including Panvel) have fared better owing to more affordable pricing and lower ticket sizes (under Rs 1 crore) with prices remaining stable over the last three years (time correction),” he said.
According to ICICI Securities’ channel checks, Chattopadhyay said, the secondary (resale) market in MMR continues to remain active while the primary market (sales by developers) continues to remain weak.
On the other hand, the NCR has seen a reduction of 20-25 per cent in prices over FY17-19 across projects, due to attempts of exit of a large number of investors and massive execution delays, especially in the peripheral areas of Dwarka Expressway and Noida Extension. “However, according to our channel checks, certain pockets of Gurugram have seen a marginal price increase of 4-5 per cent in FY19,” he said.
With about 50 per cent of projects being stuck with no resolution in sight as many of these projects have already sold units to customers, new homebuyers are moving towards nearing completion/ready units across cities, he said.
“Hence, we are of the view that levels of “saleable inventory” by developers to customers is not all that gloomy and actual inventory levels would be closer to 18-24 months if one were to exclude these stalled projects,” he said.
According to industry estimates, ready/nearing completion unsold inventory accounts for 8-10 per cent of the overall unsold inventory. Even before the introduction of the Real Estate
Regulator under the RERA and GST implementation, customers had already begun gravitating towards ready inventory across cities.
According to Liases Foras, across India’s top eight tier-I Indian cities, the percentage share of sales of ready properties has risen from 11 per cent in 2014 to 27 per cent in 2018.
About 59% of residential supply in Q4FY19 was in less than Rs 50 lakh category
Mumbai peripheral prices remain stable in the last three years
NCR market sees a reduction of 20-25% in prices over FY17-19 across projects
Certain pockets of Gurugram see a marginal price rise of 4-5% in FY19