Bengaluru: Bengaluru’s residential market has the second highest number of unsold houses, surpassing Mumbai for the first time, according to a note by property consultant firm JLL.
In the second quarter of 2015, the number of unsold housing units in Bengaluru stands at around 84,000 with an inventory period of around 32 months. Inventory period is the time taken for a developer to clear its stock.
The consulting firm said the city has witnessed a new peak in terms of unsold inventory as buyer sentiment has been affected by the economic conditions.
Ahead of Bengaluru is the national capital region (NCR), which has been by far one of the worst residential markets with piling unsold houses, particularly in the premium segments.
“The rising unsold inventory is a result of developers continuously launching new projects in the last few quarters as they need cash flow to run their businesses and as land prices have been shooting up," said Anuj Puri, chairman and country head, JLL India.
He said though enquiries for residential properties are happening; buyer sentiment has been affected by macro-economic conditions, causing them to put their buying decision on hold.
However, Bengaluru is a more stable market than Mumbai and NCR.
“The primary reason behind their confidence is the fact that Bangalore remains a very end-user driven market, quite unlike Mumbai and NCR, which have traditionally been speculative, investor-driven markets," Puri said.
At present, ticket sizes for most projects in the city range from Rs75 lakh to Rs1 crore. While housing units in range of Rs35-80 lakh are sold quickly, those of Rs1 crore and above take longer to sell.
Puri said sales and buyer sentiment are likely to remain muted for some more time.