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Residential realty sees early signs of green shoots

The top 35 cities recorded a 5% quarter-on-quarter increase in home sales in the third quarter of FY20 and a 3% year-on-year rise, the firm’s latest data shows.

, ET Bureau|
Last Updated: Feb 14, 2020, 07.30 AM IST
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Mumbai: Indian home buyers are slowly getting enthusiastic about buying property again. After a lull for much of last year caused by the economic slowdown and uncertainty over incomes and jobs, buyers returned to the property market again in October-December of 2019 driving up home sales, a survey by Liases Foras Real Estate Ratings & Research, property research firm, shows.

The top 35 cities recorded a 5% quarter-on-quarter increase in home sales in the third quarter of FY20 and a 3% year-on-year rise, the firm’s latest data shows. This is a marked improvement from the second quarter (July-September) performance when annual and sequential sales fell 2% with 22 out of the 35 cities seeing a drop. This time, sales rose in 27 out of the 35 cities. New launches, an indicator of business confidence among builders, increased 38% from a year ago, the survey said.

“The year 2018-19 had seen a marginal decline in both sales and launches. The downward slide has now been arrested and the trend is reflecting an upward movement. Time correction has improved homebuyers’ affordability. And with inquiry levels going up, builders have garnered confidence to launch more projects,” said Pankaj Kapoor, MD, Liases Foras Real Estate Ratings & Research. The dominance of affordable housing in sales continued in the third quarter, with over 58% of the purchases coming from people buying apartments at below Rs 50 lakh.

About 66% of the launches also happened in this segment. Bengaluru, Hyderabad and Mumbai Metropolitan Region (MMR) contributed to growth in the quarter, with Chennai and Kolkata posting a sharp fall in sales. The National Capital Region (NRC), which includes New Delhi, eked out a 1% increase in sales QoQ, though annual sales fell 10%. Sales in MMR rose 5% QoQ and dipped 1% YoY, though outer MMR posted a sharp 10% rise in annual sales.

Sales in Chennai and Kolkata fell, with the southern city posting a 10% decline QoQ and a 20% annual fall. Sales in Kolkata rose 2% annually, but dipped 5% QoQ.

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