Mumbai, Pune have highest unsold stock among eight key markets: PropTiger report


A quarterly analysis of key residential markets in India shows that Mumbai and Pune contributed 4,11,616 units to the unsold stock comprising 7,38,340 units, as on June 30, 2020

Mumbai and Pune continue to hold the largest share of housing stock lying unsold across India’s eight prime residential markets, shows PropTiger.com data. According to Real Insight: Q2 2020, a quarterly analysis of key residential markets in India, the two cities contribute 4,11,616 units to the unsold stock comprising 7,38,340 units, as on June 30, 2020.

Cities included in the analysis are Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Delhi-NCR (Noida, Greater Noida, Gurugram, Ghaziabad and Faridabad), the MMR (Mumbai, Navi Mumbai and Thane) and Pune.

When compared to the total unsold stock in these eight cities, the inventory burden has come down by 13%. At the end of June 30, 2019, builders in these markets had an unsold stock consisting of 8,46,460 units. This decline in unsold stock could primarily be attributed to a consistent fall in new launches.

However, when compared to the same period last year, the inventory overhang has increased from 28 months to 35 months. Inventory overhang is the estimated time that developers will take, to sell off the stock at the current sales velocity. It is also reflective of the sales situation in a city. A higher overhang indicates that a market would take a much longer time to rebound, when compared to its peers.

 

Inventory overhang

 

See also: Launches and sales witness sharp fall in Q2 2020 amid COVID-19 pandemic: PropTiger report

 

Inventory overhang in eight cities

City Inventory overhang Unsold units
Ahmedabad 26 38,933
Bengaluru 32 75,493
Chennai 36 36,272
Hyderabad 19 32,068
Kolkata 38 32,832
MMR 40 2,76,492
NCR 53 1, 11,121
Pune 30 1,35,124

Data as on June 30, 2020

Source: Real Insight: Q2, 2020

Check out property prices in Mumbai

 

The inventory overhang was lowest in Hyderabad (19 months), while it was the highest in the NCR (53 months). In spite of the fact that the unsold stock was comparatively higher in Pune, the inventory overhang in the city (at 30 months) was much lower than that of the NCR market. After the NCR, the MMR had the highest inventory overhang, at 40 months.

Hyderabad also has the smallest unsold stock, when compared to all the other markets.

Of the entire unsold stock, nearly 20% of homes were ready-to-move-in units, the report indicates.

Check out properties to buy in Hyderabad

 


Previous reports:

Affordable housing accounts for 50% of unsold stock in MMR in July 2019: PropTiger report

There were over 2.90 lakh unsold units available for purchase in the Mumbai Metropolitan Region till the end of July 2019 and nearly half of this stock, 1.41 lakh homes, belonged to the affordable housing category, says a report by PropTiger.com

September 27, 2019: There is no dearth of affordable properties in India’s most expensive property market, Mumbai, according to data available with PropTiger.com. There were over 2.90 lakh unsold units available for purchase in the Mumbai Metropolitan Region (MMR) till the end of July 2019 and nearly half of this stock, 1.41 lakh homes, belonged to the affordable housing category.

From a taxation point of view, units priced up to Rs 45 lakhs are considered affordable homes and various waivers are available to buyers of such homes, especially if they are availing of home loans. In the Budget 2019-20, the tax deduction limit on home loan interest component was raised to Rs 3.50 lakhs a year, as against Rs 2 lakhs earlier, provided the loan is taken for a unit not priced over Rs 45 lakhs. Banks also charge comparatively lower interest on affordable housing units, under the government’s Pradhan Mantri Awas Yojana (PMAY), as central subsidy is available for such loans. The goods and services tax rate on such units has also been substantially slashed, to 1%.

The easy availability of affordable homes and cheaper financing options, could trigger fresh activity in the festive season that starts in India from Navaratri and goes up to the New Year. “We expect home sales to see a remarkable improvement in the MMR, this festive season. While the government has launched a slew of measures, to make purchases of affordable homes quite lucrative, the easy availability of ready-to-move-in homes in this category only makes it more convenient for buyers. We are certain that property seekers, who have put on hold their purchase plans due to monetary constraints, would make good use of the low interest regime now,” says Dhruv Agarwala, Group CEO, Elara Technologies.

 

MMR localities with maximum unsold affordable homes

A majority of the unsold units in the MMR, are concentrated in Thane west, Neral, Dombivali, Mira Road east, Panvel, Virar and Chembur, data shows.

 

Locality Average rate (in Rs per sq ft)
Thane west 10,570
Dombivali 6,233
Neral 3,012
Mira Road east 7,700
Panvel 6,000

Source: PropTiger.com

 

New launches and delivery of units in the MMR

Data also shows that a total of 59,042 units were delivered in the first half of 2019, the highest number of housing delivery recorded in the first half of a year, since 2014. Nearly 41% of this stock (24,188 units) was housing units priced within Rs 45 lakhs. Also, a total of 26,400 units were launched in the MMR in the first six months of 2019. Nearly 44% of the new launch units were priced below Rs 45 lakhs.

 


FAQs

Which city has the highest number of unsold housing units?

As on June 30, 2020, Mumbai had the highest number of unsold housing units at 2,76,492, according to PropTiger.com’s Real Insight: Q2, 2020 report.

What is the inventory overhang in the residential segment?

The inventory overhang in India’s residential segment stood at 35 months, as on June 30, 2020.

Which city has the lowest inventory overhang?

Hyderabad had the lowest inventory overhang as on June 30, 2020, at 19 months.

 

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