Real estate research firm PropEquity said new home sales in Mumbai and NCR dropped over 50 per cent in Q1 of this calendar year.
The report covers sale of new launches alone and does not include resale of properties.
Bangalore was relatively better logging an 18 per cent fall in the numbers. Total absorption fell to 7,704 units in Q1 from previous year’s 9,410 units.
MUMBAI DOWN 58 %
In the Mumbai Metropolitan Region, the total absorption fell to 11,473 units from 27,676 units, year-on-year. The total supply in Q1 of CY2012 was 89,461 units.
The total absorption in the NCR has dropped to 15,104 units from previous years’ 35,420 units. Total residential supply in Q1 of CY2012 was 107,731 units.
Mr Samir Jasuja, Chief Executive Officer, PropEquity, said “In the coming quarter, there would be strong pressures on many micro-markets and we expect inventory overhang to increase and absorption could continue to slow down.
“Mumbai and Gurgaon have already seen one of the sharpest falls in absorptions; with MMR seeing a drop of 58 per cent and NCR 57 per cent. If this trend continues, there could be ‘stage 1’ price correction in the range of 5 to 20 per cent, especially in micro-markets of NCR, MMR and Hyderabad.”
Some micro-markets, where inventories have been managed well by developers would be able to overcome this phase.
Bangalore has done reasonably better, given the demand has been end-user driven and new inventories have been fairly low in the quarter. Generally, investor-driven markets would see downside risks than end-user driven markets, he said.