Ground Reality - Moderate Sales + New Launch Absorption Down

All India monthly residential sales volumes has moderated from an aggregate 19,700 units/month sold in March-May to 16,100 units in June-August across the markets we track. Residential new launch absorption has fallen from between 40%-60% in April-June to about 20%-25% in Jul-Aug.

The inventory of unsold homes in the Rs0.5-Rs3.0 mn/unit range has been increasing through CY2009. Cumulative absorption is encouraging in pockets of NCR but below 40% in some markets like Chennai and Bangalore.

Take-up across the six major markets of Mumbai, Gurgaon, Bangalore, Hyderabad, Chennai and Kolkata in August 2009 was about 70% lower vs. August 2008. However, the trajectory in Mumbai and Bangalore has improved a bit since March.

Property investors have been quite active over the past six months in Chennai and NCR with regard to take-up of new launches, however their is no significant pick-up in volume.

Noida - Residential Project Prices

Noida has witnessed fair amount of new project launches in 2009 from Jaypee, Unitech, Divine India Infrastructure, 3C Group, Amrapali Group etc. Here is the latest update our Analyst from Delhi NCR is filing on the SELLING price of these projects. [Click on IMAGE to Enlarge]
Do let us know your DEALING experience in the above projects as this will help otehr prospective BUYERS.

Gurgaon - New project Launch Prices

Our analyst has done an excellent job touching base with most property developers like - Falcon Builders, M2K, Rahejas, Emmar MGF, Pareena Infrastructure, Pal Infrastructure, Unitech, Vatika, Millenium Spire, Pioneer Urban land, etc in Gurgaon and here is how new Residential projects have been launched in the past 6 months and their SELLING prices / sft for the convenience of all the readers is tabulated as below. [Click to Enlarge]Kindly share your experience in BUYING or DEALING with any of the above property developers so that it will help other readers.

Historical Mumbai Property Prices 1993 to 2009

Residential demand is a function of affordability, direction of selling prices and consumer confidence. As prices and interest rates dropped, we saw affordability improving. If prices remain at current levels, affordability will rise only with an increase in household income as further interest rate reduction is unlikely. But on the contrary, if interest rates start moving up then affordability will start emerging as a big concern again.

The following Chart Shows Historical Property Prices in Mumbai between 1993-2009 at Bhandup Mulund Ghatkopar Goregaon Chembur Powai Andheri (W) Bandra (W) Worli and South Bombay.

Government Bill on model real estate

The Union housing and urban poverty alleviation ministry is expected to come out with a bill aimed at taming the demand supply mismatch in housing consumption in big cities. The ministry has invited expert and public opinion for the proposed legislation.

The ministry has already held preliminary discussions with various stakeholders. The government has initiated the process of shaping a model Real Estate (Regulation of Development) Act in this wake. The ministry has targeted to promote planned and healthy real estate development of colonies and apartments, keeping protection of consumer interest in view. The proposed bill is expected to facilitate smooth and speedy urban construction.

More efforts would be taken to encourage institutionalised financing and formal channels of credit. Developing countries are facing increasing effects of climate change, resource depletion, food insecurity, population growth and economic instability.

Prices in Mumbai Western + Central Suburbs Rise

We attended a property exhibition organised by MCHI, with participation by 75 developers and a number of housing finance companies.

Most developers have raised prices in the past four months, and prices are back to their lifetime highs. Many visitors, however, indicated that prices had shot up beyond their affordability.

Developers too displayed a sense of uncertainty, primarily showcasing their existing projects and going slow on new launches.

Western Suburbs Residential Realty Prices:
All prices have risen and the percentage rise is provided.
Oberoi Oberoi Springs Andheri 20,765 19,000 9% [20,765 is the current price]
Oberoi Oberoi Splendor Andheri 11,860 10,200 16%
Mantri Mantri Park Goregaon 5,999 5,590 7%
Rustomjee Elanza Malad 9,500 9,000 6%
Ackruti Gardenia Mira Road 3,350 2,950 14%

prices in Central suburbs are up 5-25%

Lodha Imperia Bhandup 6,500 6,300 3% [6500 is current price]
Kalpataru Aura Ghatkopar 7,000 6,700 4%
Runwal Pride Mulund 8,000 7,000 14%
Runwal Anthrium Mulund 6,600 6,100 8%
Gundecha Zenith Mulund 5,991 5,300 13%
Hiranandani Estates Thane 5,350 5,032 6%
Hiranandani Meadows Thane 5,450 5,200 5%
Runwal Pearl Thane 4,500 3,700 22%

Unitech Homes - No Constrcution Activity

BNP Paribas analysts visited the sites of newly launched Unitech Homes projects and were shocked to find that the company has not launched any Construction Activity. Here is an excerpt from the report of various projects of Unitech Ltd.

Uniworld Gardens II Residential - Apartments Gurgaon Fully Sold Mar-09 No construction activity
The Villas Individual Bunglows Gurgaon na Aug - Sep 09 No construction activity
The Residences Residential - Apartments Gurgaon Fully Sold May-09 No construction activity
Sunbreeze Residential - Apartments Gurgaon Fully Sold Aug - sep 09 No construction activity
Unitech Vistas Residential - Apartments Kolkata 20-25% sold Jul-09 Preliminary construction activity
Gateway Phase 2 Residential - Apartments Kolkata 5 - 10% sold Aug-09 No construction activity
Unihomes Residential - Apartments Kolkata 0-5% sold Aug-09 No construction activity
Unihomes Residential - Apartments Noida 80% sold Jul-09 No construction activity
Uniworld Gardens Residential - Apartments Noida more than 70% sold Jul-09 No construction activity
Willows @ Grande Residential - plots Noida 40% sold Jul-09 Preliminary construction activity
Unihomes Plots Residential - plots Greater Noida Fully Sold Jul - Aug 09 No construction activity
Unihomes Residential - Apartments Greatern Noida ~ 5% sold Sep-09 No construction activity
Unihomes Residential - Apartments Chennai 300 units sold Aug-09 No construction activity
Ananda Residential - Apartments Chennai Fully Sold May-09 No construction activity
Brahma Residential - Apartments Chennai Fully Sold May-09 No construction activity

With Real Estate Regulator coming into force, Unitech will have a tough time if it continues such practices.