If we compare the September quarter this year and of the previous year, it’s 17% rise in home space sales in 8 metro cities, according to the renowned property research firm, Liases Foras. The improving economic sentiment shows that the individual buyers now assume that the market has bottomed out.
The recent report says that an aggregate of 67.8 million sq ft of home space was sold across 8 metro cities as compared to 57.8 million sq ft a year ago. However, on a quarter on quarter comparison it’s found that home sales were down by 6%. According to the statistics, unsold stock was increased by 18% year on year, whereas 6% was increases quarter on quarter to 1075.7 million sq ft. As far as the unsold inventory is concerned, it rose 8% over last year in NCR and 27% in Mumbai.
Construction companies and developers are offering a range of freebies, discounts and new payment plans to the potential customers in October- December quarter which has traditionally been a very good period as per as the sales are concerned. Every developer wants to see the affordability of the customers increase. This is why instrumental measures such as reduction in interest rates have been taken by the developers.
Commodity price decline has also been influential in price cuts and discounts, offered by developers.
According to Liases Foras home sales will increase in coming quarters. NCR, Mumbai and Hyderabad have seen a price drop of 4%, 2% and 2% respectively. At the same time, cities like Bangaluru, Pune, Chennai and Ahmedabad have seen a price rise of 2%, 2%, 2% and 1% respective. Real estate home prices have remained constant in Kolkata.
National President of the Confederation of Real Estate Developers, Getamber Anand has stated that people who were waiting for the right time, have started buying now as they have realized that the market has bottomed out.
Mr. Anand has also stated that the price of NCR has come down by 15 to 20% in last one and half years. The home sales have increased due to the reduction in home loan rates as well. However, NCR market hasn’t yet seen significant improvement of sales in September quarter according to Mr. JC Sharma, the vice chairman and managing director of Sobha developers.
Chennai has shown the sign of improvement along with Greater Mumbai. High valued properties in Bangaluru have seen selling issues whereas the mid valued ones have done fairly well. According to the Liases Foras, 17% increase in sales was only in affordable housing segment, i.e for the flats below 25 lakhs. 40% of this was sold in Ahmedabad.
If 8 metro cities are considered, 33% of sales were generated in the housing segment in which flat prices are between 50 lakhs and 1 crore, followed by flats of 25 lakhs to 30 lakhs price bracket. 8.4 million sq ft of 67.9 million sq ft of space was sold in luxury segment flats (price more than 2 crores). In this particular luxury segment Mumbai Metropolitan Region has witnessed 32% of sales where as NCR and Bangaluru have witnessed 23% and 20% sales respectively.
9% growth from the previous quarter was seen in new launches. 66% more new launches were seen in NCR as compared to that of the previous year. Most of these sales came from 50 lakhs to 1 crore price range.