The adverse impact of reforms introduced to clean up the real estate sector is seen ebbing with homes sales numbers estimated to have increased by 25 per cent in 2018 when compared to 2017. Data available with PropTiger.com show 3.1 lakh units are likely to be sold across nine major cities of the country by the end of this year. The nine cities included in the analysis are Ahmedabad, Bengaluru, Chennai, Gurgaon, Hyderabad, Kolkata, Noida, Mumbai and Pune.
The affordable housing segment has been a key contributor to the sales numbers. Cities that would contribute the highest to these numbers are Mumbai and Pune.
With the real estate law building much-needed pressure, project completion rate is also seen improving. There has been a significant rise of 55 per cent in unit completed over 2017. Mumbai and Pune were the largest shareholders on that account, claiming 36 per cent share in overall numbers.
Developers’ focus on project completion has also resulted in new launches seen declining 22 per cent during the year when compared to 2017. Data show only 1.9 lakh new units were launched in 2018. Except for Bengaluru and Chennai, all other cities have seen a continuous fall in the number of launches over the quarters. The Mumbai Metropolitan Region and Pune collectively witnessed a decline of 39 per cent in new supply as compared to the previous year. New launch numbers may decline further in 2019 amid liquidity crunch and rising compliance.
The year also saw a reduction in inventory stock— unsold inventory decreased by 14 per cent in 2018 as compared to 2017. At the current sales velocity, it would take real estate developers in the nine cities 29 months to sell their existing housing stock. Hyderabad has the lowest inventory overhang of 18 months whereas Ahmedabad has the highest inventory overhang of 48 months.