National, April 29, 2019- PropTiger.com, part of Elara Technologies Pte Ltd which also owns Housing.com and Makaan.com, today released the findings of its ‘Real Insight Report’ for Q4 FY’19. As per the report, homes sales in India’s nine key property markets declined 5% year-on-year (y-o-y) and new project launches fell 32% annually during Q4 FY’19. However, the unsold housing stock declined by 10% during the same period.
Mani Rangarajan, Group Chief Operating Officer, Elara Technologies said, “While there might not be any significant improvement in new launch and home sales numbers in the first quarter of FY20, things may start to change after the results of the Lok Sabha elections are announced. In fact, as more clarity emerges pertaining to GST issues, these numbers might see improvement in the quarters that follow. Property rates would also see an upwards movement in the times to come.”
Sales decline due to change in GST rules
As against 79,601 units in the Q4 FY’18, developers in the nine property markets together sold 75,706 units in the same quarter in FY19. The report attributes this decline in home sales numbers to the changes in the Goods and Services Tax (GST) transition rules.
The GST Council has given developers time till May 10 to choose between the old tax rates and the new rates to help resolve input tax credit issues. Realtors opting for new GST rates, which are lower than the old rates, will not be able to claim input tax credit.
Despite an overall decline in numbers, home sales in some cities increased in Q4, including Hyderabad, Gurugram, Pune and Mumbai.
At 26%, homes sales increased the highest in Hyderabad in the quarter ending March 2019. Noida, on the other hand, saw sales declining 50% during the same period over the previous year. At 23%, home sales also fell significantly in India’s information capital Bengaluru.
City
|
Sales
| ||
Q4 FY'18
|
Q4 FY'19
|
YoY Change
| |
Ahmedabad
|
5,289
|
4,739
|
-10%
|
Bengaluru
|
10,969
|
8,402
|
-23%
|
Chennai
|
4,819
|
4,197
|
-13%
|
Gurugram
|
5,220
|
5,764
|
10%
|
Hyderabad
|
5,618
|
7,059
|
26%
|
Kolkata
|
3,352
|
3,623
|
8%
|
Mumbai
|
22,904
|
23,718
|
4%
|
Noida
|
7,718
|
3,856
|
-50%
|
Pune
|
13,712
|
14,348
|
5%
|
Grand total
|
79,601
|
75,706
|
-5%
|
Launches fall as caution among developers continues
Except Chennai, Pune and Gurugram, new launches fell across cities, resulting in an overall decline of 32% in Q4 y-o-y. Ahmedabad, Kolkata, Bengaluru and Mumbai saw the sharpest fall in launches during the quarter. The Chennai property market witnessed an opposite trend with launches more than doubling during y-o-y.
After the country launched the real estate law in 2016, developers in India have been cautious about launching new projects as the law imposes strict penalties in case of project delays. Huge unsold housing stock has been also been forcing developers to refrains from launching new projects and focus on selling the existing inventory.
City
|
Launches
| ||
Q4 FY'18
|
Q4 FY'19
|
YoY Change
| |
Ahmedabad
|
8,122
|
232
|
-97%
|
Bengaluru
|
10,964
|
5,026
|
-54%
|
Chennai
|
3,661
|
7,867
|
115%
|
Gurugram
|
4,705
|
4,929
|
5%
|
Hyderabad
|
6,285
|
6,066
|
-3%
|
Kolkata
|
5,366
|
1,273
|
-76%
|
Mumbai
|
16,097
|
7,352
|
-54%
|
Noida
|
2,124
|
1528
|
-28%
|
Pune
|
8,695
|
10,561
|
21%
|
Grand total
|
66,019
|
44,834
|
-32%
|
Developers’ burden seem to be reducing as inventory declines 10%
A cautious approach among developers to improve sales and restrict launches resulted in a fall of 10% in the unsold housing stock in Q4 FY’19 when compared to the same quarter the previous year.
As against 890,719 units in Q4 FY’18, the unsold housing stock in the nine markets stood at 800,438 units in Q4 FY’19. Apart from Ahmedabad and Chennai, unsold inventory declined in all the other cities.
Overall inventory overhang, too, reduced significantly to 30 months in Q4 FY’19 from 39 months in Q4 FY’18. While Hyderabad has the lowest inventory overhang at 17 months, it is the highest in Ahmedabad, at 40 months.
City
|
Unsold Inventory as on quarter end
| ||
Q4 FY'18
|
Q4 FY'19
|
YoY Change
| |
Ahmedabad
|
61,683
|
63,114
|
2%
|
Bengaluru
|
87,110
|
77,835
|
-11%
|
Chennai
|
37,728
|
38,226
|
1%
|
Gurugram
|
47,793
|
46,046
|
-4%
|
Hyderabad
|
42,270
|
35,148
|
-17%
|
Kolkata
|
48,629
|
44,689
|
-8%
|
Mumbai
|
3,32,719
|
2,88,679
|
-13%
|
Noida
|
79,605
|
65,006
|
-18%
|
Pune
|
153,182
|
141,695
|
-7%
|
Grand total
|
890,719
|
800,438
|
-10%
|
Prices remain stable; future hike likely
Except Hyderabad, where prices increased 14% y-o-y, rates of property across cities have remained almost unchanged – either increasing or decreasing only marginally – in the past one year. The report, however, indicates that prices may see an upwards movement in future as developers start adjusting rates to include the impact they would suffer due to loss of input tax credit on GST payment.
The study covered nine key Indian cities of Mumbai, Pune, Noida, Gurugram, Bengaluru, Chennai, Hyderabad, Kolkata and Ahmedabad.
About Elara Technologies Pte. Ltd.
Singapore-based technology services company Elara Technologies Pte. Ltd is the owner of Housing.com, PropTiger.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 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 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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