Pune and Bangalore have seen over 100% growth in terms of new residential units launched by organised developers in the first three months of the current calendar year, during a period when overall growth across eight major cities in the country declined by 2%.
According to the latest quarterly report by real estate consultancy firm Cushman & Wakefield (C&W), approximately 38,000 new units were launched in Mumbai, NCR, Bangalore, Kolkata, Pune, Hyderabad, Chennai and Ahmedabad in the Jan-March 2013 quarter. With 11,600 new units, (including 5700 in the affordable segment) Bangalore saw the highest growth of 144%, followed by Pune with 6,700 new units (including 6100 in the mid-end segment), translating into a growth of 109%.
Bangalore also recorded the highest number of launches in the period contributing close to 31% of the overall new supply in the top eight cities, followed by NCR and Mumbai. The growth in Mumbai in comparison to the previous quarter (Oct-Dec 2102) stood at negative 3% while in NCR it was -39%.
Of the eight cities surveyed, the decline was highest in Hyderabad which had 589 new units launched against 5225 units in the previous quarter, a drop of 89%. The least number of new homes was in Ahmedabad where the survey noted 200 new units were launched in Q1 CY 13 compared to 524 units in Q4 CY 2012.
Shveta Jain, Executive Director, Residential Services, C&W said, “The country’s residential market witnessed some vibrant launch activity in Pune and Bangalore during the quarter despite the sluggish economic environment. Funding will remain a major challenge for developers while executing these projects. Given the rise in construction cost, cost of land and funding no major price cuts have been possible in the current subdued business environment.”
According to Jain, prices are expected to remain largely stable in the coming months as developers will be looking mainly to boost sale and increase cash flows in projects being currently executed.