Carefully study the Residential Apartments absorption rate and available inventory to see where the prices will go next. Government policy likely to be fairly stable.
Gurgaon recorded average monthly absorption of 2,242 units/months in 2Q10. This is 13% higher than 1Q average and largely stable at CY09 average. Months of unsold inventory (~6 months) continued to decline in the market and is currently at its two year low thereby keeping pricing relatively strong.
Absorption pick up in Noida/Greater Noida has been astonishing as run rate over Apr/May tripled from 1Q levels. New launches by Jaypee Infratech and local developers have contributed a lot to this. Key launches Supertech's Ecovillage in Greater Noida and Jaypee’s Kensington project in Noida.
Average monthly sale run rate (4,816 units/month) in Mumbai (including Navi Mumbai and Thane) in 2Q stabilized (up 2% Q/Q) after witnessing a 13% volume decline in 4Q10. Months of unsold inventory continued to decline in the market and is currently at its two year low of 9 months.
Average monthly sales run rate (1,725 units) over 2QCY10 in Bangalore were largely flat after witnessing 13% decline in 1Q. Decline in 1Q was primarily on account of seasonal weakness. Months of unsold inventory has been coming down over the last one year; however it still remains high at 15 months thereby keeping the prices under check.
Chennai is witnessing steady pick up in absorption with average sales run rate (1,307 units) over Apr/May increasing by 23% from 1Q10 levels. Months of unsold inventory has been declining over the last one year.
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