PropTiger Q2 Report FY'16: Brick-By-Brick Account Of How The Top 9 Cities Have Fared
Here is an overview of how the top nine cities fared during the second quarter of financial year 2016 based on the report, Realty Decoder-Q2'FY16, released by PropTiger.com's Data Labs division.
Sales: Down 10%
Property prices: Up 2.9%
New launches: Down 46%
This Gujarat city has now become a high-priced real estate market with the price range in every segment growing rapidly. The price range of homes went up 28 per cent over the previous quarter, as Ahmedabad home buyers seem to prefer luxury homes. In line with the demand for luxury, the city has a low unsold inventory in the over Rs 1-crore home segment (it accounts for only 14 per cent of the total unsold inventory).
The city presents an opportunity for end-use home buyers in the low-priced segments. Over 80 per cent of the demand in the city is in the under Rs 50-lakh segment. The city also has an unsold inventory of 43 per cent in the affordable category (as many as 17,161 homes out of a total of 23,400).
The city has a large section of unsold homes in the ready-to-move-in segment at 13.5 per cent, as compared to the country-wise average of around three- four per cent. The inventory overhang is comparatively low at 29 months or a little over two years. Only 22 per cent of the unsold homes are older than over three years.
Sales: Down 11%
Property prices: Up 4.8%
New launches: Down 52%
At around 107,454 units, Karnataka capital Bengaluru has joined the league of cities with huge unsold inventory. Of the unsold homes, around 6.8 per cent are ready for possession, much higher than the national average of three-four percent. The average inventory overhang is at 31 months. All the pointers indicate that the Bengaluru realty market is under stress. At 43,609 units, a little less than half of the city's unsold inventory is in the affordable range. Most of such homes are in the Electronics City area, where a number of such projects are being launched.
This presents an opportunity for end-users looking for affordable homes. The spending power of the end-users is comparatively higher, as 38 per cent of the demand is in the Rs 50-75 lakh range.
Chennai
Sales: Down 9%
Property prices: Up 0.4%
New launches: Down 23%
The burgeoning real estate market in south India has a low unsold inventory of 46,150 units, much less than the comparable markets of Bengaluru and Pune. However, unsold homes in the ready-to-move-in segment accounts for 11.6 per cent of the total numbers. The age of inventory does not bring in good news either, as around 50 per cent of it is over two years old while half of it is more than three years old.
Chennai also presents a good opportunity for end-users. With most units in Kelambakkam, Mevallurkuppam or Avadi, there are as many as 25,391 affordable units available. The city has 50 per cent of its demand in the affordable segment. The property prices in Chennai also moved extremely marginally or remained stable, indicating high levels of stability. Buyers can also look forward to individual discounts since there is much scope for negotiation owing to stable prices.
Hyderabad
Sales: Down 8%
Property prices: Up 3.8%
New launches: Up 23%
Hyderabad's real estate market has revived after the state bifurcation and the city presents great prospects. The city also has a surprisingly low percentage of investor demand at only five per cent. It shows that end-users who have been staying away from buying, are now coming back to the market.
Hyderabad is also the only city where the number of launches have gone up. Most of this increase came from Provident Housing's Kenworth, which launched a massive project with over 2,000 units. The launches are targeting the pent up demand in the city. The city also has one of the lowest unsold inventory at 28,670 units, higher only than Ahmedabad. Of the total unsold inventory, ready-to-move-in homes account for 11.7 per cent.
At 38 months or over two-and-a-half years, the inventory overhang is similar to that of Chennai and Bengaluru. Around 27 per cent of the unsold inventory is over three years old. Hyderabad is the city where the demand is expected to pick up much quicker than in other cities after interest rate cuts and other incentives.
Like , the unsold inventory of Hyderabad in the affordable range is at 12,196 units and is coming up in Kukatpally and Komapally areas. However, property prices in Hyderabad have not shot up.
Sales: Down 15%
Property prices: Up 1%
New launches: Down by 50%
Home sales in Kolkata have fallen a tad higher than in most comparable markets. However, at 31,913 units, the city's unsold inventory is not too high. Most of these units are in the affordable category (around 20,556 units). The arhat New Town locality accounts for many such units. The total inventory overhang is at 30 months or over two-and-a-half years. At 5.1 per cent, ready-to-move-in homes form only a marginal part of the unsold homes.
While the city's real estate is not as stressed as Bengaluru, Mumbai or Noida, the city, which saw very high sales in the last three years, is now showing signs of reduced activity.
The West Bengal capital also has a high percentage of end-user demand at 90 per cent. Overall, price change for new homes that are coming up is also low at around eight per cent, showing that not many expensive homes are being built by the developers.
Sales: Down 21%
Property prices: Down 1.8%
New launches: Down 78%
Noida can be dubbed as the most stressed realty market where the impact has already started showing. It is the only one of the top nine markets where property prices fell by 1.8 per cent on an average. Many real estate experts say that individual discounts on offer are also increasing, which is good news for end-users and buyers. New launches have also gone down by 78 per cent.
Noida is sitting on a huge unsold inventory of 99,894 units, with 1.9% of these being in the ready-to-move-in segment. The inventory overhang is also quite high at 59 months or four years and nine months. Thirty-three per cent of the unsold homes have remained so for the last three years and 60 per cent of the inventory remained unsold for over two years. The investor demand is at 16 per cent, much lower than Gurgaon, leaving a large percentage of end-user demand. Due to this, home buyers are actively seeking bargains.
Sales: Down 11%
Property prices: Up 1%
New launches: Down 19%
Pune has been contributing heavily to sales of homes in the country. It also presents a very comfortable situation with highest liquidity of low-aging and low- inventory overhang. While the number of unsold homes is 74,023 units, 5.1 per cent are in the ready-to-move-in segment. The inventory overhang is at 24 or two years, much better than most of the cities in the list and only 11 per cent of the unsold homes have remained so for three years or more.
Among unsold homes, Pune also has a large number in the affordable category at 43,609 units in areas such as Wagholi, Moshi, Undri, Chakan and Chikali. Only 11 per cent of the unsold homes are in the over Rs 1 crore category, showing that the demand and sales of luxury homes in the city are intact.
Sales: Down 13%
Property prices: Up 4%
New launches: Down 68%
The Maximum City with its burgeoning population has massive demand for housing both rental and sale, while it faces space constraints. However, sales have been slow as the city is sitting on an unsold inventory of 1,55,093 units. Mumbai's inventory overhang is at 43 months or around three-and-a half-years. And, over 28 per cent of the inventory in the unsold category is over three years old. Over 73,000 units in the unsold inventory is in the affordable category measured across the main city of Mumbai, Navi and Thane. Among the three, Thane has the largest number of unsold homes in the affordable category at 36,931 units. Many such homes are in areas such as Virar, Bhiwandi, Dombivali and Panvel. Mumbai also has a large number of unsold homes priced over Rs 1 crore.
The price changes of new launches have also remained low in Mumbai going up only by eight per cent, indicating that builders are concentrating on smaller and cheaper homes. In , the overall prices of new launches went down by three per cent.
Gurgaon
Sales: Up 1%
Property prices: 0% change
New launches: Down 44%
Gurgaon, the most vibrant real estate market of the country, is facing the blues. While it is the only market where sales have gone up one per cent in the current quarter over the previous quarter, there is a long way to go for Gurgaon to turn comfortable. Meanwhile, buyers have a great opportunity to invest in the city with softening prices. Fence-sitting buyers may make a move now, as Gurgaon, along with Sohna and Bhiwadi, is sitting on an unsold inventory of 44,069 units. Of this, the percentage of ready-to-move-in homes is low at around 1.3 per cent. Gurgaon and surrounding areas have the highest inventory overhang among the top nine cities at 54 months (around four-and-a-half years) on an average. However, unsold affordable units are also pricier as most of these are in Bhiwadi. Sohna has around 1,000 unsold homes in the affordable category, while Gurgaon has around 700 such homes. Property prices in Gurgaon have not changed at all.
City Noida Gurgaon Mumbai Hyderabad