Housing sales fell 30%; new launches decline 44% in Q3FY20: PropTiger report


by Shrutee K/DNS

New Delhi: New project launches in India’s nine key residential markets continued to show a decline, falling 44 per cent year-on-year in the period between October and December 2019, primarily on liquidity concerns, shows the report by PropTiger.com, part of Elara Technologies, that also owns Housing.com and Makaan.com.

According to “Real insight Q3FY20”, a quarterly analysis of India’s nine key property markets by PropTiger DataLabs, the ongoing industry concerns related to the NBFC sector, on which real estate developers largely depend on for their financial needs, has made borrowing difficult for builders at a time when a demand slowdown has hit housing sales. This double whammy has resulted in developers continuing to show a cautious stance towards new project launches. 

“The various measures launched by the government in the recent past to revive growth in the real estate market seem to have made little impact. Considering real estate is a major contributor to overall GDP, which hit a glacial 4.5 per cent rate of growth in the July-September period, we expect further assistance from the government, which would nudge buyers to invest in real estate. In the Union Budget scheduled to be released on 1st February, we expect the Hon’ble Finance Minister to announce measures that would result in higher savings for individual taxpayers, some of which would hopefully make its way towards property purchases,” said Dhruv Agarwala, Group CEO, Elara Technologies, the country’s only full stack real estate technology platform that owns Housing.comMakaan.com and Proptiger.com

Sales fell across cities
Housing sales in India’s nine key property markets fell 30 per cent annually during the October-December quarter despite the government launching several measures in the recent past to revive buyer sentiment. As against 91,464 units sold during the quarter last year, only 64,034 homes were sold across the nine markets in Q3 this year. Mumbai contributed nearly 40 per cent to overall sales numbers. 

What points towards a nation-wide phenomenon, sales declined across all these markets, with Bengaluru, popularly known as India’s Silicon Valley, registering a 50 per cent fall in sales numbers.  

When compared to the first nine months of the previous financial year, sales fell by 13 per cent during the same period in the current fiscal. As against 263,294 units last year, only 228,220 housing units were sold this year.

Units Sold
Growth
City


Q3FY19
Q4FY19
Q1FY20
Q2FY20
Q3FY20
YoY (%) Q3vsQ3
QoQ (%) Q2vsQ3
Ahmedabad
5,960
6,414
6,479
5,578
5,118
-14%
-8%
Bangalore
10,299
10,092
9,600
8,425
5,155
-50%
-39%
Chennai
4,467
4,605
4,571
3,772
3,015
-33%
-20%
Gurgaon
4,069
6,970
5,880
3,581
3,834
-6%
7%
Hyderabad
7,869
8,857
7,723
7,002
4,372
-44%
-38%
Kolkata
3,810
4,341
4,333
3,052
2,566
-33%
-16%
Mumbai
30,850
27,527
28,726
24,882
25,198
-18%
1%
Noida
4,556
4,148
3,627
3,038
2,830
-38%
-7%
Pune
19,584
17,911
18,034
15,883
11,946
-39%
-25%
Grand Total
91,464
90,865
88,973
75,213
64,034
-30%
-15%

Sold Units

City


Apr-Dec 18
Apr-Dec 19
YoY (%)
Ahmedabad
17,436
17,175
-1%
Bangalore
31,932
23,180
-27%
Chennai
14,011
11,358
-19%
Gurgaon
11,794
13,295
13%
Hyderabad
21,505
19,097
-11%
Kolkata
10,754
9,951
-7%
Mumbai
85,811
78,806
-8%
Noida
19,141
9,495
-50%
Pune
50,910
45,863
-10%
Grand Total
263,294
228,220
-13%

Inventory declined 12%
As buyers showed greater faith towards ready homes, inventory levels, declined 12 per cent during the quarter. From 8.83 lakh unsold housing units at the end of the same period last year, unsold stock fell to 7.75 lakh in Q3 FY20. Mumbai and Pune together contribute 57 per cent of this unsold stock.  Also, half of the units in this stock are affordable homes (units priced below Rs 45 lakh). 

At the current sales velocity, builders would take 29 months to sell off the existing stock.

Unsold Inventory
YoY (%) – Q3vsQ3
QoQ (%) Q2vsQ3
City
Dec/2018
Mar/2019
Jun/2019
Sep/2019
Dec/2019
Dec 19 Vs Dec 18
Dec 19 Vs Sep 19
Ahmedabad
60,015
57,220
52,294
50,690
48,367
-19%
-5%
Bangalore
86,335
83,447
80,520
79,046
79,496
-8%
1%
Chennai
36,642
37,344
35,384
33,304
33,694
-8%
1%
Gurgaon
46,364
44,469
44,522
44,199
42,071
-9%
-5%
Hyderabad
42,140
41,509
38,349
35,216
33,227
-21%
-6%
Kolkata
46,364
44,861
42,040
40,029
37,979
-18%
-5%
Mumbai
338,894
328,052
317,253
305,018
296,465
-13%
-3%
Noida
67,991
65,577
63,847
61,545
59,261
-13%
-4%
Pune
158,738
155,679
151,842
148,676
144,300
-9%
-3%
Grand Total
883,483
858,158
826,051
797,723
774,860
-12%
-3%

Over 5 lakh new units to be delivered in CY2020
A total of 5.33 lakh units were delivered across the nine markets in calendar year 2019, and another 5.45 lakh units are expected to be delivered through the course of calendar year 2020.

Launches fall most in Kolkata, Gurugram
Only 41,133 units were launched in Q3 FY20 as against 73,226 units in the corresponding period last fiscal, the report shows. New launches fell across markets, with Kolkata and Gurugram seeing the biggest fall, at 79 and 74 per cent, respectively. Nearly 40 per cent of new launches were concentrated in India’s financial capital Mumbai, data show.

Affordable housing continued to dominate launches, with 52 per cent units launched in this segment.

When compared to the first nine months (April-December) of the previous financial year, launches declined by 32 per cent during the same period in the current fiscal. While 215,596 units were launched between April and December in the previous year, 145,852 units were launched during the same period this year.

Prices increase marginally across cities; Hyderabad sees 13% appreciation

Average values of property increased by 13% year-over-year in Hyderabad, the highest increase among all the cities included in the report, while Gurugram and Ahmedabad registered 6% and 5% increase, respectively.  In other cities, prices showed only nominal increases, between one and three per cent.  

(The cities coved in the analysis are Ahmedabad, Bengaluru, Chennai, Gurugram (includes Bhiwadi, Dharuhera and Sohna), Hyderabad, Kolkata, Mumbai (includes Navi Mumbai and Thane), Pune and Noida (includes Greater Noida and Yamuna Expressway))

About Elara Technologies Pte. Ltd.Singapore-based technology services company Elara Technologies Pte. Ltd., co-founded by Dhruv Agarwala, Group CEO, is the country’s only full stack real estate technology platform that owns Housing.com, Makaan.com and PropTiger.com.

Housing.comFounded in 2012, Housing.com is India’s most innovative real estate advertising platform for developers, real estate brokers, home owners and tenants. The company offers the largest selection of verified listings in India through a trained team of data collectors, analysts and auditors. The one-of-a-kind Data Sciences Lab at Housing.com analyses a significant body of data to allow buyers and sellers to make intelligent decisions.

PropTiger.com: PropTiger.com is India’s leading digital real estate advisory firm offering a one-stop platform for buying residential real estate. Founded in 2011 with the goal to help people buy their dream homes, PropTiger.com leverages the power of information and the organisation’s deep-rooted understanding of the real estate sector to bring simplicity, transparency and trust in the home buying process. PropTiger.com helps home-buyers through the entire home-buying process through a mix of technology-enabled tools as well as on-ground support. The company offers researched information about various localities and properties and provides guidance on matters pertaining to legal paperwork and loan assistance to successfully fulfil a transaction. Since inception, the PropTiger.com team has facilitated the sales of close to 25,000 homes worth nearly US$2.2 billion. 

Makaan.com: The platform was acquired by Elara in May 2015, with a vision to establish a true "marketplace" in real estate. With consumer ratings on more than 30,000 sellers, credible listings data and real-time intelligence on property search, makaan.com has quickly emerged as the preferred partner for consumers looking to rent, buy or sell a home. With its unique post-paid advertising fees model and value proposition of no upfront fees for sellers, makaan.com has grown to have more than 45,000 active sellers with over 15000 active brokers in a short span of time. makaan.com offers its online consumers the maximum property options and has become one of the largest advertising platforms in online real estate in India with 1 million residential properties listed across the country.Makaan.com was recently selected as a runner up in the Most Innovative Platform category at a global event in the ICMA event held at Vienna, Austria.

FastFox.com : FastFox.com is an online-to-offline (O2O) brokerage firm that works in partnership with other brokers and landlords to list residential properties online for rental purposes. FastFox.com has pioneered the revolutionary ‘Open House’ model for rentals in India, in which a house is open for viewing by home seekers for a scheduled period of time.

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