New home launches at 5 yrs low in 2015

Q: New residential launches and sales declined sharply in 2015.

Sashidharan,

29th January 2016

Real estate News in Mumbai

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Replies (6)

Hi folks,
You will be glad to know that during Prime Minister Narendra Modi's foreign trips that have helped India to attract more FDI. From the nations they visited during the financial year 2014-15, India received FDI of USD 19.78 billion. Moreover, foreign direct investment (FDI) in India increased by 27% in 2014-15 to USD 30.93 billion. In other fronts as well, it is time to monitoring on how 2015 was for the real estate sector, and to clear look into 2016.

Sameer Khan, Delhi-NCR

23rd February 2016

Comment

Hi Sameer,
Union Budget 2016-17 is expected to bring variation in the country's real estate landscape from its current recessive state to a progressive sector. A revival in the real estate sector would impact multiple businesses, while giving a massive boost to the overall economic growth of the country.

Siddharth Rana, Pune

23rd February 2016

Hi folks,
Mumbai's real estate sector has recorded the lowest number of new launches in the first half of 2015 since the realty slowdown began in 2008. Add to it the fact that there are around two lakh unsold homes and slowing sales, and what this means is that there will be no recovery in the housing market for at least another 6-months. As per report, January-June 2015 the number of new launches in the Mumbai Metropolitan Region declined by 47%, 18887 units compared to 35512 units launched in the same period last year.

ajit pandey,

18th February 2016

Comment

Yes, and it is considered as the worst hit is the luxury residential market. Not a single residential project priced at more than Rs 5 lakh has been launched in the first half of the current year.

Shalini Parikh, Mumbai

18th February 2016

Hi Shalini,
Real estate is the safe heaven for all black money in India. Modi is bragging about bringing black money from aboard but has done nothing to stop black money in domestic real estate sector. Common men could not offered to buy a flat or plot for living because of sky rocketing prices due to black money in the sector.

Ayesha, Delhi-NCR

23rd February 2016

Hi Folks,
This is only because of the restricted new launches and slow sales have helped in bringing down the pressure level in the residential market, with the unsold inventory returning to the 2013 level. While Mumbai leads in this open, Hyderabad and Pune follow.

Balaji, Bangalore

29th January 2016

Comment

And as per the recent data, current unsold residential inventory levels across India stands at over 6.9 lakh units and this would take more than 2.5 years to round off. NCR is the worst affected market in India with both launches and absorption failing to raise.

Ayesha, Delhi-NCR

29th January 2016

The real estate industry was hit hard in 2015 by poor sales of residential projects and fewer launches, resulting in a surge in unsold inventory. While the sales volume during 2015 was similar to that in 2014, new launches fell sharply by 21% across the country, Knight Frank said in the 4th edition of its half-yearly report – India Real Estate. Last year the sales volume stood at 2.64 lakh units, while in 2014 it was 2.74 lakh.
In terms of new launches, NCR, Mumbai and Bengaluru witnessed a sharp drop of 20%, 36% and 27% respectively during 2015.

Aarav Sharma,

29th January 2016

Comment

If we see the Thane locality, we found that it emerged as the silver lining with demand increasing by 13% as good connectivity to office markets, with right ticket size products attracted buyers. Premium South Mumbai market witnessed 108% jump in new project launches to 208 units in 2nd half of 2015, while demand increased by 52% to 220 units.

Dev Patel, Mumbai

29th January 2016

Right Dev,
Even the affordable markets of the peripheral MMR areas are under significant pressure, and both sales and new launches have been on a decline in spite of the RBI's reduction of policy rates and the Central Government's focus on affordable housing. Sales in this sector are not likely to see any significant recovery during January-June 2016.

Shalini Parikh, Mumbai

29th January 2016

@Shalini I agree that the markets are under significant pressure and investor confidence has been low during the last year. However, I see a bounce back in 2016 and here's why. Currently the Indian real estate market is at a stage where it can only rise. Home prices have come down by 15-20 per cent in the last one and a half years due to corrections, which combined with the reduction in home loan rates has helped improve sales in last few months.
Over the year, incomes of working couples have also risen by 10-15 per cent, boosting home sales by genuine first time buyers, whereas reduced interest rates, cheaper EMI, price correction has encouraged the end-users to invest in real estate. Reduction in interest rates for home loans has been a key factor responsible for the changing mood of the market. Lower interest rates, along with stable property prices should fuel the middle and lower income segment of buyers.

Aarav Sharma,

1st February 2016

@Shalini,
2015 for Indian real estate had both the good and bad news. While the office market grew from strength to strength, Office market saw a record absorption at 40.4 million sq-ft. highest since 2012 but residential did not perform as per expected.

Dev Patel, Mumbai

29th January 2016

Comment

In spite of festive season and 125 bps rate cut by RBI, demand did not see an uptake. Our approach for 2016 remains deaden. To further revive the demand, it is important to give the benefits of the rate cuts to consumers.

Ayesha, Delhi-NCR

29th January 2016

@Shalini,
Realty market in Mumbai Metropolitan Region remained motionless as reforms failed to cheer and housing consumption moving to pre-2014 general election stage. New launches in MMR in 2nd half of 2015 were down by 23% from a year ago period, while demand reduced by 6%.

Deepti Baragur, Pune

29th January 2016

Hiello Dipti,
But prices, here have become stagnant with marginal 3% rise indicating a good time for end user to buy homes. Affordable housing segment between Rs 30-60 lakh price range experienced the difficulty with Navi Mumbai, Peripheral Central and Western suburbs witnessing huge drop in demand.

Shalini Parikh, Mumbai

29th January 2016

Yes, and the data indicates that the new home launches and sales are the lowest since 2010 across top 8 properties markets of India. While the sales volume during the year was similar to that in 2014, new launches fell sharply by 21%.

Dev Patel, Mumbai

29th January 2016

Comment

Very sad Dev.......
Data also indicates that the Mumbai property market witnessed the sharpest drop with 36% in new residential property launches during the year, followed by 27% and 20% decline in Bengaluru and National Capital Region, respectively.

Shalini Parikh, Mumbai

29th January 2016