Five out of eight top cities witnessed a drop in home sales in the March quarter, with the sharpest drop in National Capital Region, even as project launches surged and property prices remained stagnant, according to a report by Liases Foras Real Estate Rating and Research Pvt. Ltd.
In the January-March period, NCR sales dropped by 9%, followed by Pune (8%) and Mumbai Metropolitan Region (MMR- 7%). Around 73,716 housing units were launched during the quarter, up 43% from the preceding December quarter and maximum launches happened in MMR, per the report.
India’s largest property market continues to remain a concern as sales also dropped by 21% in 2018-19, compared to the year before.
“Sales were on an upward curve last year but the NBFC liquidity crisis and confusion over GST (Goods and Services Tax) put a brake on sales in the March quarter. The key takeaway is that there is underlying pent up demand for homes, but that needs to now translate into actual sales. We expect launches to continue along with price and other incentives from developers to attract buyers to boost cashflows. However, the downward pressure on prices will continue for some time given that the unsold inventory levels are still high," said managing director Pankaj Kapoor.
The only three cities that showed upward trend in quarterly sales are Kolkata (33%) followed by Hyderabad (13%) and Ahmedabad (4%). Hyderabad is the only city which saw a Q-oQ rise in home prices by 4% while Mumbai saw a drop of 2% and all other cities remained stagnant.
Similar to the December quarter, close to 54% of the sales in the March quarter were in the sub- ₹50 lakh segment, which was supported by various government initiatives in the affordable housing segment.
A consumer sentiment survey published by Anarock Property Consultants on Wednesday said that while ready-to-move-in homes remained the preferred choice for several homebuyers, over 18% of respondents now prefer new launch properties as against 5% in the previous survey.
“Interestingly, 44% non-resident Indians now consider new launch properties over under-construction (to be completed in one year) or ready-to-move-in homes," the Anarock report said.