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Home sales declined 11%, new launches fell 47% in June quarter: PropTiger report


National, July 22, 2019- PropTiger.com, part of Elara Technologies Pte Ltd, which also owns Housing.com, Makaan.com and FastFox.com, today released the findings of its ‘Real Insight Report’ for the first quarter of the financial year 2019-20 (Q1FY20). According to the report, home sales in India’s nine major cities declined nearly 11% in Q1FY20 when compared to the same period last year. New launches nearly halved during the same period, falling 47% year-on-year.



Dhruv Agarwala, Group CEO, Housing.com, PropTiger.com, Makaan.com, Fastfox.com said, “While we saw a decline in both sales and launches in Q1 FY20, the outlook is optimistic going forward. A stable government at the centre and a Union Budget that announced several favourable measures for the residential real estate sector are likely to act as catalysts. The budget has offered relief to homebuyers by increasing the tax deduction limit on the interest payable on home loans to Rs 3.50 lakh for affordable homes that should drive demand in that segment. Additionally, several banks have lowered interest rates after the RBI reduced the repo rate to a record low. We are confident that these measures are likely to stimulate home sales in the coming quarters.”



Sales decline in more than half the cities; Gurugram bucks trend

When compared to 80,628 units in Q1 FY19, only 71,957 units were sold in Q1 FY20, a fall of nearly 11%. Home sales, however, increased in some cities, including Gurugram, Hyderabad, Kolkata and Pune. The sharpest increase in sales was seen in Millennium City Gurugram, where 4,951 units were sold in Q1 FY20 as against 3,737 units in Q1 FY19, showing an increase of 32%.



Interestingly, over half the units sold in Gurugram during the quarter, were priced within a Rs 25-lakh budget range and were for properties primarily lying on the city's peripheries. This is a remarkable change for a city known for its premium properties that carry a comparatively high price tag.



City

Sales

Q1 FY'19

Q1 FY'20

YoY Change

Ahmedabad

5,268

3,362

-36%

Bengaluru

10,219

8,431

-17%

Chennai

4,683

4,574

-2%

Gurugram

3,737

4,951

32%

Hyderabad

5,665

6,204

10%

Kolkata

3,156

3,481

10%

Mumbai

26,222

22,652

-14%

Noida

7,425

3,304

-56%

Pune

14,253

14,998

5%

Grand total

80,628

71,957

-11%



Launches fall as caution among developers continues

As against 71,970 units in Q1 FY19, only 37,852 housing units were launched in Q1 FY20, resulting in a fall of 47%. Barring Gurugram where new launches more than doubled – from 2,588 units to 5,945 units – new launches fell across cities during this period. This was likely due to developers adopting a cautious stance in anticipation of the national election results that were announced only in May 2019.

Tough liquidity conditions continue to force developers to keep their guards on and exercise caution with regard to new launches, which is a prudent approach in a difficult environment.





City

Launches

Q1 FY'19

Q1 FY'20

YoY Change

Ahmedabad

7,499

824

-89%

Bengaluru

8,750

5,169

-41%

Chennai

3,502

2,374

-32%

Gurugram

2,588

5,945

130%

Hyderabad

5,499

2,416

-56%

Kolkata

2,846

2,004

-30%

Mumbai

22,761

8,757

-62%

Noida

3,820

1,835

-52%

Pune

14,705

8,528

-42%

Grand total

71,970

37,852

-47%



Developers’ burden seen lightening as inventory declines over 12%



The positive news during the quarter was the decline in existing housing stock, primarily on account of the sharp decline in new launches. In the past year, inventory declined by over 12%. Real estate developers are sitting on an inventory of 797,623 units at the end of Q1 FY20 as against 909,324 units at the end of Q1 FY19. Inventory declined across cities, data show.



Inventory overhang also reduced slightly to 30 months — at the current sales velocity, it would take developers less than three years to sell the existing housing stock.





City

Unsold Inventory as on quarter end

Q1 FY'19

Q1 FY'20

YoY Change

Ahmedabad

64,563

60,521

-6%

Bengaluru

87,602

77,295

-12%

Chennai

37,878

37,109

-2%

Gurugram

47,449

46,426

-2%

Hyderabad

43,322

32,874

-24%

Kolkata

50,146

44,970

-10%

Mumbai

343,111

292,225

-15%

Noida

76,378

63,637

-17%

Pune

158,875

142,566

-10%

Grand total

909,324

797,623

-12%



Nearing completion

While stating that 120,500 units were delivered by developers in the nine key markets during the first three months of FY20, the report says that another 500,000 housing units are likely to be delivered by March 2020.



Prices remain largely flat; growth momentum in Hyderabad continues

Except Hyderabad, where prices increased 17% y-o-y, rates of property across cities have remained largely flat in the past year.



The study covered nine key Indian cities including Ahmedabad, Bengaluru, Chennai, Gurugram (includes Bhiwadi, Dharuhera and Sohna), Hyderabad, Kolkata, Mumbai (includes Navi Mumbai and Thane), Noida (includes Greater Noida and Yamuna Expressway) and Pune.





About Elara Technologies Pte. Ltd.

Singapore-based technology services company Elara Technologies Pte. Ltd is the owner of Housing.com, PropTiger.com,  Makaan.com. and FastFox.com. The company provides digital real estate marketing and transactions services.



Housing.com

Founded 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

Makaan.com 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 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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