Residential real estate sales at 22.2 mn sq ft this year, new launches decline

Launches in July 2018 were significantly lower than the monthly average of 14.5 mn sq ft in the past 12 months. Consequently, inventory across India dropped 10 percent to around 1 bn sq ft from 1.1 bn sq ft in July 2017. Prices saw a slight increase in July 2018 averaging around Rs 6,100 per sq ft (Rs 6,000 per sq ft in the first quarter of the financial year 2019), data in the report suggested.

As far as the National Capital region is concerned, sales activity remained upbeat at 4.3 mn sq. ft in July 2018. Across all metros, launches remained the lowest in Delhi NCR with only 1 mn sq ft released in July 2018 in peripheral regions of Ghaziabad and Greater Noida.

Net unsold residential inventory in NCR stood at 243 mn sq ft as of July 2018, equivalent to 63 months of sales (based on average of trailing 12 months). On monthly basis, prices remained largely flat in NCR in July 2018 at Rs 4,521 per sq ft (up only 1.4 percent year-on-year).

Launches in MMR remained upbeat at 2.9 mn sq ft in July 2018 (average monthly sales of 3.5 mn sq ft in the first quarter of 2019 and 4.4 mn sq ft in July 2017) led by new projects coming up in Mumbai and Thane. Sales too kept up with the momentum seen in the past month with 5.3 mn sq ft residential area being sold during July 2018, contributed from the same regions, the data suggested.

Average realization in MMR region inched upwards to Rs 10,300 per sq ft in July 2018  led by more sales in Mumbai region. Outstanding inventory in MMR remains the highest across metros at 290 mn sq ft as of July 2018 (equivalent to 54 months of sales), declining by 7 mn sq ft till the year to date of the financial year 2019.

Sales for Bengaluru market stood at 4.1 mn sq ft against launches of 2.4 mn sq. ft in July 2018. Launches averaged at 3.9 mn sq ft for the first quarter of the financial year 2018. Launch activity, though moderated in July 2018, is likely to pick up. Unsold inventory at 163 mn sq ft (as of July 2018) continues to be the lowest across regions in India.