New Project Launch Dimmed In Major Cities By 16% (Jan-March)

A negligible number of new launches across top eight cities witnessed an average decline of 14% year – on – year in 2016. For now, the residential unit launches have declined in 2016 by 12% to more or less 113,000 units and the unit launches continued to be cascading in the first quarter of 2017 as well. According to the Cushman & Wakefield report Country’s top 8 property markets have witnessed a 16% on-year reduction in new residential project launch which indicates that there’s a sag of 25,800 units of new launches in the in the Q1 2017.  New residential launches have dropped nearly 8% during the period April 2016 to March 2017 compared to the same period in 2015-16.

Following by a growing demand market is expecting natural flow in new project launches post RERA implementation. While most of the states are yet to submit respective RERA rules buyers are pretty unsure about the revisal of dynamic market graph. It’s prescribed that RERA implementation won’t collide with the current market price in the short to medium term.

Kolkata has always given a stable and fair market for top to bottom of the pyramid.  But these days, People are mostly choosing low budget flats in Kolkata over the luxury ones. Interestingly, there has been a hike in affordable project development of 30% compared to 25% in the same period in FY 2015-2016 counterbalancing the viable market demand. While, the sale of ultra-luxury residential projects have been dropped by 11% from 13% during the same period due to compressing market demand. Yet, a measured sale growth is predicted at the second half of 2017.

Major property markets such as Delhi, Bengaluru, Mumbai and Kolkata are currently sitting on huge unsold inventories. New launches in Bengaluru almost dipped by one-third compared to the previous quarter. Developers are trying to reduce their inventory level with attractive packages and bonny offerings in order to the push the sale upwards as well as to mature the present market condition which is kind of forcing them to freeze the new launches. It seems like builders have to wait for another couple of quarters prior to any new launch.

“RERA is the much awaited realty review platform. It will play a pivotal role in determining the economic framework of demand and supply. RERA will eliminate the faith dearth between buyers and builders. Residential sector will recover soon after the developer and the realtors start practicing in justifiable course realty under RERA domain as it will apply a uniform code of conduct for developers across country,”- said RERA (West Bengal Chapter) expert Mr. Mahesh Somani.