Insite Report Apr-Jun 2018

METHODOLOGY

The Insite Report by 99acres.com captures the quarterly capital trends and the annual rental analysis of residential apartments in key real estate markets – Delhi NCR, Mumbai Metropolitan Region (MMR), Bangalore, Pune, Chennai, Hyderabad, Kolkata and Ahmedabad. In order to assess the prevailing sentiment, the report delves deep into demand and supply of properties across varied budget segments and occupancy stages. While demand is a function of queries received, supply is based on property listings posted on 99acres.com in Apr-Jun 2018.

NATIONAL OUTLOOK

HOME BUYING SENTIMENT

The realty landscape witnessed a fleeting calm even as enquiries and sales recorded a slight uptick in most metro cities this quarter. While the non-formation of a RERA-body marred buyer sentiment in Kolkata and Hyderabad, the approaching ‘Aadi’ period slackened growth in Bangalore and Chennai. A revival in property sales is expected in the festive quarter.

PROPERTY PRICES

Price movement remained marginal across cities, except Hyderabad, which saw notable growth due to infrastructural overhaul and robust office-space absorption. The premium segment remained passive as affordable housing grabbed a majority share of buyer demand. Any significant deviation in average weighted capital ‘asks’ is likely to happen around Oct-Dec 2018.

RENTAL LANDSCAPE

The rental landscape continued to remain upbeat for the seventh consecutive quarter. Rental values witnessed a notable hike across cities, except Delhi NCR and Pune where a pile-up of ready inventory inflicted the market. The growth is likely to continue for a few more quarters, until home buying picks up pace and sees a complete revival.

SUPPLY

The hiatus in new launches amidst piling residential stock helped cities such as Bangalore, Mumbai, Pune, Chennai and Hyderabad rationalise inventory levels. Slow-paced registrations under RERA played a key role in curtailing the saleable primary stock. The trend is expected to continue as no exceptional measures are being observed to fast-track RERA registrations.

 Market Indicators_Apr-Jun 2018

IN FOCUS

RERA ANNIVERSARY

May 1, 2018 marked the first anniversary of the Real Estate (Regulation and Development) Act, 2016 [RERA]. The implementation progress varied from State to State depending on timely compliance with Central RERA rules. Kerala, West Bengal and the six north-eastern States are yet to implement the Act. Others including Karnataka, the NCT of Delhi and Tamil Nadu made snail-paced progress, tarnishing consumer sentiment.

GENERAL BUYING SENTIMENT

Buyer confidence ameliorated for RERA-approved projects. A resurgence of fence-sitters in select pockets, driven by connectivity and job opportunities, was a testimony to the reviving market. Conversion rate improved, albeit minimal. The affordable housing sector garnered maximum buyer interest, however, RERA registration alone did not suffice to drive buyers towards under-construction properties.

PROPERTY PRICES

Enquiries resurfaced and led several housing pockets register an uptick in property prices. While Hyderabad reported a notable rise in residential property rates, Pune and Chennai maintained status quo. Delhi NCR and Mumbai reported a price correction in the last one year due to discounts offered by developers to lure buyers back into the market.

NEW LAUNCHES

New launches nose-dived across cities due to increased compliance under RERA. Chennai, Hyderabad and Kolkata reported a 50-70 percent dip in launches, YoY, largely owing to delayed notification of RERA rules. Delhi NCR, Mumbai, Bangalore and Pune, too, witnessed new launches coming to halt. A year later, the markets seem to have gained ground with new launches reporting an improvement, QoQ.

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