- Chennai remained the only city to have witnessed a meagre price correction of one percent, QoQ. However, any dip in the prices was noted on the back of hefty discounts floating in the market and a wide negotiation window.
- New residential launches remained restricted in Jul-Sep 2020; however, some green shoots of recovery were reported in sale enquiries. South Chennai remained the most active micro-market in terms of new launches and sales.
- Ready-to-move-in inventory saw maximum traction, and the under-construction segment remained under stress.
- Housing demand is likely to shoot up in the next few months in areas such as OMR, Mount-Poonamallee and CBD. Affordable housing inventory continued to remain the most popular amongst homebuyers.
* Supply is basis properties listed on 99acres.com * Demand is basis queries received on 99acres.com
Limited deals, stagnant sales, and delay in new launches defined Chennai’s real estate market in Jul-Sep 2020. With COVID-led lockdown subsequently getting extended on Sundays until August-end, construction activities remained largely impacted. While new launches were limited in number, property enquiries reported an uptick towards the end of the quarter. Residential sales dipped by over 30 percent, YoY. In line with the previous quarters, ready-to-move inventory saw maximum enquiries.
Several homebuyers deferred their buying decisions due to uncertainty in the job market and in anticipation of price correction. The builder fraternity, on the other hand, reeled under the impact of slow-paced construction cycle, labour scarcity and rising cost of raw materials.
Nonetheless, backed by planned expansion of industries and commercial activities, North Chennai remained popular among buyers and builders. Completion of the Outer Ring Road (ORR) from Nemilichery to Minjur, the Peripheral Ring Road linking Ennore Road to Poonerji junction, and to-be operational Washermenpet-Wimco Nagar metro rail would also help improve realty sentiment in the region.
In the coming quarters, developers are looking at completing the ongoing projects and clearing the unsold inventory of roughly 19,000 units. Housing demand is likely to shoot up in the next few months in areas such as OMR, Mount-Poonamallee and CBD.
Key micro-markets across budget segments
|Key micromarkets||Average Capital 'Asks'||Average Rental 'Asks'||Rental Yield|
|Within Rs 40 lakh||Guduvancheri||3,100-3,700||11||3.30%|
|Rs 40 lakh - Rs 1 crore||Avadi||3,800-4,500||11||3.10%|
|Rs 1 crore and above||Velachery||6,200-7,500||18||2.77%|
* Note: Rental Yield has been calculated for a 1,000 sq ft apartment. **Average property prices and rental rates have been calculated as per listings posted on 99acres.com in the studied quarter. ***The range of property prices may vary by 10 percent depending on the age and furnishing status of the residential apartments