Market analytics indicate that over 4.4 lakh housing units of unsold inventory have been taking the Indian realty market by the storm. The year 2018 has kick-started with a boom, as buying a residential property has become affordable for the mid-segment.
The unsold stock of ready-to-move-in residential properties is projected at 34,700 units in the top cities of India. Delhi – NCR has the highest volume at around 150,654 units that remained unsold in 2017, while Chennai had the highest percentage of completed unsold inventory at close to 20 percent, the report said. It also noted that Kolkata had the lowest volume of unsold inventory at approximately 26,000 units.
A considerable figure of unsold inventory will make sure that the capital values in the country will remain buyer-friendly, and lead to an increase in the sales velocity. Moreover, with a deceleration in new project launches, in different markets, the sector experts project more absorption of unsold inventory in the next few quarters. As a drift, homebuyers have been tending to come into the market closer to date of completion, which will increase the absorption rate of the unsold units. Capital values remain unwavering, with a descending bias across most markets, making it favorable for buyers.
The housing segment has been on a reboot-mode for quite some time due to a lot of structural changes that have happened. From the commencement of 2017, the sector has undergone changes like RERA, Demonetisation and GST, impact of which is not entirely recognized.
These have also resulted in a broad-spectrum slowdown in construction activities. On the other side of the coin, demand also has been sluggish due to these changes. We look forward to sales velocity to start picking pace in the second half of the year typically on account of stable prices making entry attractive.