Mumbai and Pune lead; contribute over 50 pc to overall sales: Report

The share of Mumbai and Pune in overall sales of top nine cities during the second quarter of this calendar year increased from 46 per cent to 51 per cent over last year, says a latest report by PropTiger.com. A significant finding of the report is that more than 30 per cent of these sales were under Rs.25 lakh budget segment. One of the key contributors to this growth, according to a top company official, is the effective implementation of RERA in Maharashtra.

New launches during Q2 (April to June 2018) across top nine cities declined 20 per cent over Q2 last year whereas sales were within 2 per cent of last year, according to the findings of PropTiger.com ‘Realty Decoded Report’.

The report said the quarter did not witness many new launches as developers are waiting for the festive season. It said large cities like Mumbai and Pune had a drop in new launches whereas markets such as Noida, Bengaluru, Hyderabad and Chennai experienced an increase.

Ankur Dhawan, CIO, PropTiger.com
“One of the key contributors to this growth is effective implementation of RERA in Maharashtra. This is a lesson for other states as well who are struggling to revive real estate industry. ”

The last year’s Q2, said the report, was an aberration as developers advanced their launches to avoid approvals under RERA regime.

According to the report, after a stupendous Q1 CY’18 sales performance, developers did not show similar aggression in marketing and sales efforts in Q2 CY’18. Most developers are saving their marketing budgets for upcoming festival quarters in Q3 and Q4 CY’18.

• The report said the quarter did not witness many new launches as developers are waiting for the festive season…Most developers are saving their marketing budgets for upcoming festival quarters in Q3 and Q4 CY’18.
• The last year’s Q2, said the report, was an aberration as developers advanced their launches to avoid approvals under RERA regime.
• The report said there is a silver lining for industry as both Mumbai and Pune, which contribute 50 per cent to overall sales, have seen their sales increasing by 15 per cent and 9 per cent respectively.
• Mumbai witnessed the highest sales volume in top nine cities followed by Pune in Q1 FY’19, more than 30 per cent of them being under Rs.25 lakh budget segment.

The study covered nine key Indian cities of Mumbai, Pune, Noida, Gurugram, Bengaluru, Chennai, Hyderabad, Kolkata and Ahmedabad.

The report said there is a silver lining for industry as both Mumbai and Pune, which contribute 50 per cent to overall sales, have seen their sales increasing by 15 per cent and 9 per cent respectively.

Mumbai sold nearly 22,000 units in Q2 CY’18 as compared to nearly 19,000 units in the same quarter last year whereas sales in Pune increased to 10,600 units from 9,777 units. Mumbai witnessed the highest sales volume in top nine cities followed by Pune in Q1 FY’19, more than 30 per cent of them being under Rs.25 lakh budget segment. Overall the share of the two cities in overall sales of top nine cities increased from 46 per cent to 51 per cent over last year.

Commenting on the report, Ankur Dhawan, Chief Investment Officer, PropTiger.com, said: “Mumbai and Pune have always been considered growth engines of Indian real estate but share of Mumbai and Pune combined increasing to 50 per cent has happened first time in last 13 quarters. New Launches also have been growing in these markets quarter on quarter, though still below last year’s number. One of the key contributors to this growth is effective implementation of RERA in Maharashtra. This is a lesson for other states as well who are struggling to revive real estate industry. ”

Among the other key highlights of the report are: unsold units across top nine markets have come down by 9 per cent y-o-y to 7,57,000 units; sales in top nine  cities have come down by 18 per cent quarter on quarter in Q2 CY’18 and 52 per cent  reduction in sales in Gurugram can be primarily attributed to drop in new launches of affordable housing units.