INDIA RESIDENTIAL REAL ESTATE QUARTERLY REPORT Q1-2017
In Q1 2017, the residential market of top 7 cities across the nation has witnessed a marginal jump of 4 percent in new launch supply, compared to the previous quarter. With a launch of around 37,359 residential dwelling units in Q1 2017, MMR accounted for 30 percent of new launch supply highest among top cities, followed by Kolkata, NCR and Bengaluru, at 22, 19 & 13 percent respectively.
An approximate 62 percent units have been launched under the budget of 40 Lac in top 7 cities, which resulted in the increased share of affordable housing by 18 percent compared to the previous quarter. On the contrary, mid and luxury segment properties have witnessed decrease in new launch supply compared to the previous quarter, by 5 and 9 percent respectively. Additionally, the ascending trend of affordable dwelling units supply in Q1 2017 is also aligned with the Prime Minister’s vision “Housing for All by 2022”.
In Q1 2017, Mumbai Metropolitan Region has witnessed a whopping jump of new launch supply under affordable and mid segment properties, compared to the previous quarter.
Nearly four-fold increase has been recorded in the new supply of affordable-mid segment properties (properties below 80 Lac) in Q1 2017. Moreover, infrastructure status provided to affordable housing in Union Budget 2017-18 will further attract more participants venturing into this segment. The residential market of NCR and Bengaluru has witnessed a decrease in new launch supply compared to the previous quarter, by 13 and 3 percent respectively. However, post demonetization, both the cities have recorded positive buyer traction and improved sales velocity.
Fewer new launches in the first quarter of 2017 and positive buyer’s interest towards ready-to-move-in projects have helped in bringing down the unsold inventory level by 9 percent from 7,34,610 units in Q4 2016 to 6,68,253 in Q1 2017 in top 7 cities.
With emphasis on “Affordable Housing” and to achieve the Prime Minister’s vision of “Housing for All by 2022”, State Bank of India has cut down rates on home loans of up to Rs. 30 Lac by 25 basis points for new borrowers. The rate was reduced to 8.35 percent from 8.60 percent—the second time in 2017.
