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Launches of new homes in top eight cities came down by 33 per cent to 60,140 units in January- September, hit by demand slowdown, but supply of affordable homes rose 27 per cent, says Cushman and Wakefield.
Housing supply stood at 89,970 units in January-September 2016 in the eight cities -- Delhi-NCR, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Pune and Ahmedabad.
Real estate developers are focusing on affordable housing after the government accorded infrastructure status to this segment and extended interest subsidy, the consultant said.
"Overall residential unit launches recorded a decline of 33 per cent and was at approximately 60,000 units in the first three quarters of 2017 (January-September)," it added.
All cities, barring Mumbai, saw a decline in new launches, mostly due to the introduction of the Real Estate Regulatory Act (RERA) and GST implementation, the consultant said.
In the January-March quarter, the consultant said developers deferred launches as they were grappling with rollover challenges of demonetisation.
However, the supply of affordable homes increased to 26,081 units in January-September 2017 from 20,485 units in the year-ago period. Of the total new launches in affordable units, 40 per cent were in Mumbai (10,500 units), followed by Kolkata and Pune.
"Affordable housing is an attractive proposition both for developers and consumers as the demand is huge and largely unmet," C&W India MD Anshul Jain said.
The focus of the central government has resulted in the availability of more funding options for the developers such as ECB, FDI and debt financing from national financial institutions at highly competitive rates, he added.
"However, there are challenges for affordable housing projects in tier 1 cities, where land costs and availability within established locations is very difficult," Jain said.
Except affordable housing, all other categories have seen a decline, with highend (-66%) and luxury (-84%) segments witnessing a significant drop in new launches, C&W said.