Record low home loan interest rates, strong hiring and salary growth in the IT sector have led to developers advancing launches to August-September 2021, successfully.
New project launches by top developers, including Godrej Properties
and Prestige Estates, have seen record sales within days. Godrej Properties
sold a record Rs 580-crore residential apartments in first day of its launch of forest-themed Godrej Woods project in Noida earlier this week.
said it had sold 340 houses having an area of more than half a million square feet on the first day of its launch, making this one of the most successful launches in the country in recent times. Bengaluru-based Prestige Estates sold out over 800 plots spread over 1.7 million sq ft within two days of the launch of its “The Great Acres” project in Sarjapur last month.
Another Bengaluru-based developer Brigade Enterprises has launched 12 projects across 4 million sqft in August 2021, including new phases in existing projects, at its virtual Brigade Showcase event in Bengaluru, Hyderabad and Chennai, ICICI Securities said in a report on Wednesday. It said the company had been able to clock monthly sales of over Rs 400 crore each in August and September 2021.
ICICI Securities said Mahindra Lifespaces’ recent Happinest launch in Chennai saw sales of over 200 units with an average ticket size of Rs 40 lakh within a month of its launch.
Adhidev Chattopadhyay, vice-president at ICICI Securities, said initially, the target was to launch residential projects from October 2021 to coincide with the beginning of the festive season. But the waning of the second Covid wave, record low mortgage rates and strong hiring/salary growth in the IT/ITes sector have led to developers advancing launches.
“We expect the momentum to be carried forward into Q3FY22 (which will coincide with Dusshera and Diwali) and expect developers to post record sales booking numbers in H2FY22, led by new launches. We estimate the pan-Indian residential market share for our coverage universe to grow from 25 per cent in FY21 to 29 per cent in FY24,” he said. He said owing to healthy balance sheets, access to capital and many unlisted, weaker developers being shunted out of the market, the market share of large and organised developers will grow further in 2-3 years.
Anuj Puri, chairman, Anarock Property Consultants, said, “It comes as no surprise that there are high sales in certain projects of leading and listed developers on the very first day of their launch. After the structural changes (note ban, RERA, GST etc.), dominance of leading and listed players have consistently risen amid changing consumer preferences. Covid-19 has accelerated this shift,” he said. According to Anarock Research, of the total sales of 203,000 units in the top-seven cities in FY17, the share of top-eight listed players was 6 per cent and that of leading unlisted players was 11 per cent, while the remaining was of unorganised players.
In FY21, of the total 158,000 units sold, the share of top-eight listed developers stood at 22 per cent, leading unlisted players share was 18 per cent while that of others was just 60 per cent.
Reflecting the buoyancy in the sector, BSE Realty Index rose for the second day in a row, ending at 3,936, about 8.7 per cent higher than Wednesday. Stocks of Oberoi Realty, Godrej Properties and DLF were major gainers.
• Godrej Properties sold record 340 apartments worth Rs 580 crore in second phase of Noida project
• Bengaluru-based Prestige Estates sold out over 800 plots spread over 1.7 million sq. ft at its The Great Acres project
• Another Bengaluru- based developer Brigade Enterprises has launched 12 projects across 4 million sq. ft in August 21
• Brokerages expect Rs 100 crore of sales bookings from Sunteck Realty’s Vasind project in Q2FY22
• Mahindra’s Happinest launch in Chennai has seen sales of over 200 units, with average ticket size of Rs 40 lakh within a month of launch
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.