 "Chart: Why Delhi's home sales jumped in Jan but Mumbai lagged")
New Delhi: While residential absorption (number of units sold) numbers in the National Capital Region (NCR) picked up 46 percent in January 2013 compared to the same period last year, absorption in the Mumbai Metropolitan Region (MMR) dropped 14 percent for the same time period.
According to a report released by PropEquity, a real estate research, data and analytics company, the number of units sold in NCR were 8,812 in January this year vis-a-vis only 6,032 last year. The MMR region in contrast saw 5,130 units being absorbed as compared to 5,983 last year - a dip of 14 percent, mainly driven by the Thane market which went down by 23 percent this January against last year.
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The clearing up of the land acquisition issues lumbering upon the area along with the highly affordable units available in Yamuna Expressway and Noida Extension have resulted in the sale of 3,998 units in January 2013. Reuters[/caption]
“This revival in NCR is caused by higher sales velocity in Greater Noida, Yamuna Expressway, Noida Extension and Faridabad. The clearing up of the land acquisition issues lumbering upon the area along with the highly affordable units available in Yamuna Expressway and Noida Extension have resulted in the sale of 3,998 units in January 2013 (in these areas); even the new launches in in this region have improved by 18 percent,” said Samir jasuja, CEP, PropEquity.
However, Gurgaon saw a downward trend in absorption, even as NCR saw an upward trend. “Gurgaon is still not very upbeat and witnessed a 4 percent drop in absorption numbers for the time period considered,” Jasuja said.
New launches in key cities also saw a drop, with the exception of Bengaluru which is still performing well.
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. The last year’s sales numbers for the month of January for Greater Noida, Yamuna Expressway, and Noida Extension stood at 694 units. Data: PropEquity[/caption]
“The developers in key cities of NCR and MMR have controlled new launches keeping in mind the liquidity crunch as well as the piled up unsold inventory (except Gurgaon). The dropping numbers of last year had forced the market to align itself to the buyer sentiments which is why the developers started launching projects at lucrative rates to boost sales. This low scale correction along with the latest 25 basis points repo rate cut by RBI will support the market. The market requires at least 75 basis further dip in repo rates to strengthen sales”, said Samir Jasuja, CEO, PropEquity.
Developers in MMR launched only 4,604 new units in January this year, compared to 8,911 in January 2012 - a drop of 48 percent - to evade any significant demand supply mismatch. New launches in NCR also dropped by 35 percent to 5,208 units from last year’s 8,041 units in January.
Explaining this, Gaurav Pandey, Senior Vice President & Head - Research and Consulting, PropEquity said, “One very striking thing noticed at the beginning of this year was that in some markets the demand has picked up whereas in others the demand has continued to drop. The developers in the cities with falling demand have controlled their new launch supply to ensure a revival of the market.”
The cities of Chennai and Hyderabad also saw a drop in absorption numbers and hence the developers curbed the new launch supply. The new launches in Chennai saw a drop of 47 percent and in Hyderabad a drop of 35 percent this January compared to last.
Bengaluru has been the only exception to the falling absorption and new launch trends. Bengaluru has witnessed an increase of 32 percent in absorption (at 4,182 units this January vis-a-vis last January’s 3,428 units) and 22 percent in new launches this January. The new launch prices in the city have also seen an increase of 13 percent for January, year-on-year.