In the backdrop of the Government easing the lockdown norms and construction activities gaining the momentum, the residential supply in Pune increased in Jul-Sep 2020. Close to 46 housing projects including new phases in existing projects, were launched during the quarter; however, the maximum new supply in the city was in the peripheral pockets located in vicinity to the crucial connectivity corridors, highlights 99acres Pune Insite Report.
While the residential supply in Pune plummeted in Apr-Jun 2020, the ensuing quarter witnessed substantial recovery. According to 99acres Pune Insite Report (Jul-Sep 2020), around 46 projects, including phased developments in existing projects, were added to the city in the studied period vis-à-vis 16 projects in Apr-Jun 2020. Overall, Pune comprised nearly 17 percent of the new supply across the top eight metro cities.
Source: 99acres Insite Report Jul-Sep 2020
Connectivity corridors remain the focal point
The maximum projects launches reported in Pune in Jul-Sep 2020 were in the peripheral pockets of Dhanori, Chikhali, Kiwale and Undri, among others. All these areas are located in vicinity to the major connectivity corridors of Mumbai-Pune Highway and Pune-Bangalore Highway.
According to Gaurav Nahata, a city-based property consultant, “The physical distancing norms have changed the way people want to reside in future. Homebuyers are now attracted towards thinly populated areas that offer seamless connectivity to various parts of the city and adequate infrastructure facilities. Altogether, the safety of the family amid the rapidly growing COVID-19 cases has become the prime decisive factor for potential homebuyers, which has pushed housing demand towards seams. Resultantly, several reputed developers, such as Goel Ganga, Krishna and Nirman Developers, Sadguru, Shiv Developers and Sonigara Homes, have launched their projects in the outlying areas, especially along the popular Mumbai-Pune Highway and Pune-Bangalore Highway. These thoroughfares directly connect to the city-centres and the IT/ITeS hubs of Baner, Hinjewadi, Balewadi and Magarpatta, and have witnessed rapid infrastructure growth in the past few years.”
Apart from the lower risk of virus exposure in peripheral pockets, the availability of relatively bigger carpet area in the preferred budget bracket also magnetised the buyers’ attention towards peripheries. Currently, around 80 percent of the housing demand in Pune is for properties priced within Rs 60 lakh. The COVID-19-led economic slowdown has reduced the investment capacity of buyers and increased the need for bigger residential units to accommodate the home office and study area requirements. Hence, the outlying areas remain the ideal investment hub for prospective buyers.
Mid-income segment rules the roost
“Amid the apprehensions of health, hygiene and wellness, buyers are more likely to trust organised developers with sound credentials as they are well-equipped to not only address these concerns but also offer a superior customer experience.”
Rahul Singla, Director, Mapsko Group
Residential developments with a carpet area of 580-800 sq ft and priced within Rs 40-60 lakh remained the most supplied in the city. However, reputed developers having better financial standing and offering the state-of-the-art infrastructure intrigued the homebuyers more than Grade B developers.
In addition to the primary market, the secondary or resale segment also contributed to the overall housing supply in Pune during Jul-Sep 2020. Sidhu Adhav, Property Consultant, Global Realtors, shares “Many people who lost their jobs and had home loans or medical emergencies to cater came forth and listed their properties for sale. Distressed selling also remained a conspicuous trend in the city.”
Holistically, while the residential supply in Pune improved in Jul-Sep 2020, it was still 50 percent of the pre-COVID-19 times as developers either refrained from launching their projects on the back of distraught sentiment or were engrossed in completing their existing projects. Nevertheless, with the ongoing festive season and the home loan interest rate at an all-time low, the market is expected to turn the corners. Besides, the Non-Resident Indians (NRIs) returning to their homeland during the festive period might also improve the sentiment and overall supply. Nahata anticipates that many developers who withheld their project announcements in the previous quarters are considering launching them in November, which might further augment the residential supply in Pune.