Where Is Realty Going, Year After Year?

A PropTiger Datalabs report for the first quarter of financial year 2017-18 that analysed real estate data of nine key markets of Ahmedabad, Bengaluru, Chennai, Gurgaon (including Bhiwadi, Dharuhera and Sohna) , Hyderabad, Kolkata, Mumbai (including Navi Mumbai and Thane) , Noida (including Greater Noida and Yamuna Expressway) and Pune has interesting insights to offer.

Let us look at some key findings.

While a quarter-on-quarter comparison shows home sales in nine major cities of India grew three per cent in the first quarter (April-June quarter or Q1) of the financial year 2017-18 (FY18) when compared to the previous quarter, an annual comparison shows an opposite picture. From 55,500 in Q1 FY17, home sales numbers came down to 53,352 in Q1FY18. In the same quarter of FY16, 57,245 units were sold, data show. At 92,725 units, home sales numbers were much higher in Q1 FY15. Basically, homes sales numbers have been falling year on year since FY15.

A similar pattern is seen when comparing new launches. The report shows 78,075 new housing units were launched in Q1FY15. This number came down to 50,594 in the same quarter of FY16. This number further declined in Q1 FY17 to reach 41,032. In Q1 FY18, new launches were limited to 29,606 units. When compared to the previous quarter, this was a fall of 43 per cent. The report also adds that all markets saw a decline in new launches over the same quarter the previous year, except Gurgaon and Hyderabad.

Also read: Home Sales Up 3% In Q1, Launches Fall 43%: PropTiger DataLabs

In the June quarter of FY15, units priced at Rs 25 lakh contributed 12 per cent to the overall new launches. Their share of overall launches has remained stable at 20 per cent across the first quarters of FY16, FY17 and FY18. The share of units priced over Rs 1 crore to overall launches, however, has been fluctuating. In FY15, this category contributed 18 per cent to launches. In the FY16, their contribution declined to reach 14 per cent. In FY17, their share will again rose to 18 per cent only to decline at 13 per cent in FY18.

In Q1 FY15, it would have taken 20 months to sell off the existing stock. In the same quarter FY16, it would have taken 22 months to sell the inventory. In FY17, it would have taken 35 months to sell off the stock. In the first quarter of FY18, it would have taken 37 months to exhaust the inventory.

Also read: Realty Rebounds In Q1; Home Sales Soar 8%

Property might have gone way out of the reach of the common man, but data show rates have been stagnant for the past three years across cities, with Bengaluru and Hyderabad being the only exception. Data show rates increased four per cent in the first quarter of FY18 in Hyderabad when compared to Q1FY17. In the same period, rates of property in Bengaluru grew two per cent.