- Launch of several new projects that were scheduled in the April-June quarter has been shelved indefinitely on the back of labour crunch, liquidity crisis, and withdrawal of buyers from the market.
- Projects nearing completion garnered maximum enquiries. Over 60 percent of the overall demand for residential properties was reported for homes priced below Rs 40 lakh.
- Average property rates in Chennai remained unchanged, QoQ. However, average rentals showed a nominal hike of a percent, YoY.
- Localities such as Sholinganallur, Thoraipakkam, and Tambaram remained popular on the back of affordability and excellent connectivity.
* Supply is basis properties listed on 99acres.com * Demand is basis queries received on 99acres.com
A few new launches coupled with poor sales volume stated the ‘real’ story of Chennai real estate market in the Apr-Jun quarter. While the nationwide lockdown halted a majority of construction activities in the city, the non-availability of migrant labourers in the city impacted the overall construction cycle in the studied period. Resultantly, several new projects that were planned to be launched in the said quarter have been shelved indefinitely. In Chennai alone, over 24,000 units were scheduled to be completed by the end of 2020. And, with the extension of the lockdown period till July end, the work on these projects is expected to experience a longer halt. In addition to the shortage of construction workers, liquidity constraints and withdrawal of home buyers from the market remained the prime challenges for the developer community.
The Apr-Jun 2020 quarter witnessed an increased affinity of serious homebuyers for projects nearing completion. In terms of housing demand, over 60 percent of the total demand inclined towards residential properties priced below Rs 40 lakh. Areas such as Navalur, Siruseri, and Perumbakkam attracted most enquiries.
Removal of stamp duty and registration charges on new and completed flats is expected to revive buyer sentiment. Several major infrastructure projects such as Chennai Metro Phase 2, Metrolite, a 110 km mega streets project, along with commercial expansion, have the potential to lift the residential real estate market in the ensuing quarters.
Price movement in key micro-markets
|Localities||Apr-Jun 2020||QoQ % Change||YoY % Change||Rental Yield|
|Avadi||Rs 3,840 - 4,320||0%||2%||3%|
|Guduvancheri||Rs 3,210 - 3,700||1%||3%||3%|
|Pallikaranai||Rs 4,250 - 5,520||2%||7%||3%|
|Porur||Rs 4,860 - 5,850||-2%||0%||3%|
|Kolathur||Rs 4,850 - 5,630||-3%||-1%||3%|
|Madipakkam||Rs 4,765 - 5,850||2%||4%||3%|
|Medavakkam||Rs 4,990 - 5,710||-1%||1%||3%|
|Urapakkam||Rs 3,180 - 3,780||-4%||1%||3%|
|Ambattur||Rs 4,680 - 5,230||2%||2%||3%|
|Sholinganallur||Rs 4,830 - 5,840||4%||6%||4%|
* Average 'ask' rates have been calculated as per listings posted on 99acres.com
** Rental Yield has been calculated for a 1000 Sq. Ft. apartment