Sale of home spaces increase by 7%

According to a report by property research firm Liases Foras, during the quarter to December 2015, sale of homes across the top eight cities of India improved by 7% year-on-year. Sales increased by 15% on a quarter on-quarter basis on the back of sluggish pricing and discounts by builders during the same period.

As per the report, an aggregate of 78 million sq ft of home space was purchased across the eight cities compared with 72.9 million sq ft a year ago.

Pankaj Kapoor, managing director of Liases Foras says, “It is a buyers’ market today. Geographies, which were predominantly investor driven, are still suffering while areas which were inhabited and more suited to end-users are seeing improvement in sales. Now the gap between affordability and pricing is reducing.”

While the purchase of home space has increased, the unsold stock has also shown an increasing trend showing 21% y-o-y and 5% q-o-q to 1,124.9 million sq ft. Unsold inventory in Mumbai rose 28% to 235.9 million sq ft while NCR rose to 361.1million sq ft, up 14% over last year.

The top cities have witnessed a decline in the total new launches with a decrease of 11% in q-o-q to 67.1 million sq ft., with NCR witnessing 61% decline in new launches during the quarter. Out of the total launches 52% of the new launches are in the price range of Rs.25-50 lakh. The number of new launches in the affordable category of under Rs.25 lakh has increased by 50% from the previous quarter.

Noting this Manoj Gaur, president, Confederation of Real Estate Developers Association of India (CREDAI), NCR, and managing director of Gaursons India, a real estate developer said, “Pricing has stagnated and inventory overhang is reducing because of lower number of new launches. Prices are close to the bottom, so end users are finding value.” To clear their unsold stock, many builders offered significant discounts during the festive period in 2015. Out of the total sales across the top eight cities, 31% of sales were in the price range of Rs.50 lakh to Rs.1 crore and about 30% of sales were in the price range of Rs 25-50 lakh.

Trump Group to construct luxury towers in Mumbai and Pune

Possible Republican nominee for US presidential elections, Donald Trump has recently spoken about India by stating how well the country is doing without being talked about.

Adding further he stated, “I have big jobs going up in India” referring to the two luxury real estate projects rightly named ‘Trump Tower’ that are coming up in Mumbai and Pune.

Signing a brand licensing agreement three years ago, Trump Group will be constructing a 75 storey tower in Worli in association with Lodha Group and a 22 storey twin tower in Pune with Panchshil Realty.

The projected real estate project includes a promise of “a host of exclusive lifestyle privileges, including a 24-hour Resident Manager and white-glove services, access to global Trump luxury properties and for the first time in India — a fractional membership to private jet service exclusively for Trump residents.”

Spread across on a 2.5 acre site with 44 luxurious condominiums across two towers of 22 storeys each, Trump Tower Pune will be the tallest residential building in that city. Each floor will have one expansive apartment of approximately 6,000 sq. ft. with five bedrooms and an exclusive home theatre room.

Adding further, the company stated the real estate property will have an exclusive range of carefully selected lifestyle amenities and services including fitness and recreational options, concierge service, pick-up and drop laundry service, and for the first time, an exclusive art gallery. There will also be a dedicated level for world-class leisure facilities such as John Abraham fitness centres, yoga room, jogging track, kids’ play area, swimming pools, library, business centre and game rooms.

Reviewing the proposed project, Pankaj Kapoor, Managing Director of real estate research firm Liases Foras said,  “These projects are for the high-end luxury market and they do not represent the market at large. Also, it is not that only because it is named Trump Towers, the companies are gaining from it in terms of sales. It is mainly the location and facilities which matter to the luxury market as well as the affordable housing market,”

Majiwada Thane Property Price Boom

According to an industry report, if the transport infrastructure projects announced by the Maharashtra Government in certain areas meet stated timelines, neighborhoods of Mumbai such as Madh-Marve, Majiwada-Kasarvadavali and Ulwe are likely to get costlier.

The report by real estate research & consultancy Knight Frank India highlights that properties in Majiwada-Kasarvadavali may get expensive by about 11.2 per cent due to the proposed construction of a Metro rail corridor from Wadala to Kasarvadavali over the next five years. Similarly, prices in the sea-front Madh-Marve are expected to increase by approximately 14.2 per cent on the back of a projected Versova-Madh sea bridge, and the Nariman Point-Kandivli coastal freeway. Further, in anticipation of the proposed Navi Mumbai International Airport and the much-delayed Sewri-Navi Mumbai Trans Harbour Link, The report estimates Ulwe to continue to see an uptick in price at 9.7 per cent rate per year, which has already inflated over the past few years.

Madh-Marve is the costliest of the three regions where Knight Frank has forecast a growth with an average rate of Rs 13,500 per square feet. While a Property at Majiwada-Kasarvadavali presently costs an average of Rs 8,000 per square feet, prices in Ulwe are floating around an average Rs 6,000 per square feet.

Pankaj Kapoor, Managing Director at Liases Foras, a Mumbai-based real estate research firm, said the low-profile areas of Mumbai are now benefiting because of the sky-rocketing prices in the high-end ones.

Housing sell will rise – festive season.

This Dewali, residential property sales may rise up to 15 per cent due to various offers and discounts by real estate developers as there are many real estate developers who are offering 15 to 20 per cent discount through various means. According to real estate experts, this festive season can holds out the hope of Indian real estate market as in major markets the demand from end users are increasing. Experts are estimating the growth of up to 15 per cent and more in residential property sales in comparison of previous year.

According to Chief Executive of one of the Mumbai-based real estate company, “From past one year there was no major price appreciation in real estate market, but this time real estate developers are offering 15 to 20 per cent discounts with an aim to make the net gain of 25 per cent in prices for buyers.” However; price reduction seems to be the most important primary reason for the consumer pull. In comparison of last year, growth in sales should be between 15 to 20 per cent, however; it also depends on the market and it is showing positive curve towards growth, as per the statement of experts, “It’s not time when we should expect the high growth number in comparison of previous boom. But still it’s expected that consecutive years of growth will help the market to recover from deep down phase. And due to that this year we are expecting good numbers”.

As per the statement of Sanjaya Gupta, MD of PNB Housing Finance, “Hyderabad, Pune, Bengaluru and the suburbs of Mumbai had seen increased activity in last few years. Last week were surprised to hear that transactions in south Delhi was high with ten high-end floors being sold. We can say that its harbinger of better sentiment”. Apart from new launches dwindling in major cities such as; Mumbai Metropolitan Region, Bengaluru, Delhi and NCR expecting are high time because most of the real estate developers focusing on clearing inventory with ready-to-move in houses in next 6 to 12 month. It will improve the confidence of buyers or end users accustomed to seeing delivery commitments being flouted. According to PropEquity, a real estate consultancy, the number of new launches in MMR, Bengaluru and Delhi-NCR has come down by over 61 per cent with 87,298 dwelling units during January to September from 227,211 in the same period of 2012.

According to statement of Pankaj Kapoor, MD of Liases Foras, “There would be a significant improvement in sales for this festive season because interest rates had come down and price had not gone up so much and developers are also offering the discounts”. The more he added that over the year’s income of working couples have raised by 10 to 15 per cent, which means affordability has improved in most markets such as; Delhi, Mumbai and NCR. In real estate market the inventory level for first quarter of 2015-2016 was rose by 24 per cent to 41 months in all major eight cities. However; NCR had the inventory of 68 months, MMR had the inventory of 45 months, and Bangalore had the inventory of 30 months, as per the reports of Liases Foras. An efficient housing market maintains 8-12 months of inventory.

It’s clear that Indian realty market has been hit economic slowdown, financial constraints of developers and low sales in last two years. According to Ashutosh Limaye, National Director, Research at JLL India, “This year will be better than the last year”. The plus point in this season is the price and it is attractive for buyers and end users. The more he added that still there is scope for negotiation. The festival season is started from October and it will continue till December, it is expected that 30-40 per cent of total house sales but in last two years very little activity has been recorded during the season.