Residential launches up 50% in Ahmedabad y-o-y in H2 2015: Knight Frank

New residential launches in Ahmedabad grew by 50 per cent in second half (H2) of calendar year 2015 over the same period last year, said Knight Frank India. Releasing the fourth edition of its half yearly report, India Real Estate, the real estate consulting firm said that Ahmedabad showed good traction in terms of new residential unit launches as well as absorption growth.

As against 4,991 new residential unit launches in H2 of 2014, Ahmedabad saw addition of 7,491 new units in H2 2015, thereby registering a growth of 50 per cent year-on-year. On the other hand, sales grew by 13 per cent for the said period, up from 8,019 units in H2 2014 to 9,075 units in H2 2015.

Further, under-construction unsold inventory also fell in Ahmedabad from 42,000 units in H1 2015 to 39,000 in H2 2015.

According to Saurabh Mehrotra, National Director-Advisory Services, Knight Frank, Ahmedabad also reported one of the shortest age of unsold inventories in terms of quarters at 7.5 quarters or 20 months. "This is one of the lowest after Pune at 6 quarters as against certain regions like NCR and Mumbai that have an average age of unsold inventories at 17 and 11 quarters, respectively," said Mehrotra.

Speaking on the findings, Balbirsingh Khalsa, National Director-Industrial, LRG & Branch Director-Ahmedabad said, "Ahmedabad is showing good traction with 13% absorption growth in Residential market in H2 2015 as compared to last few years.We feel prices have bottomed out and therefore, it is an excellent time for end users to invest in properties now. We are expecting positive outcomes from 2016 and expect the growth will end up being a sustainable one."

In terms of price growth, while all India figures stood at three per cent, that for Ahmedabad stood in the range of 3-7 per cent for H2 2015.

For the whole year, new launches recovered by 11 per cent during 2015 to 15,552 units from 14,011 in 2014. However, this has meant an increased stress in the market and worsening of the oversupply situation in the city.

On the other hand, sales volume in Ahmedabad fell by nine per cent during 2015 to 16,826 units from 18,490 a year ago, thereby registering the city's lowest sales volume in the last six years and nearly halving from its peak of 30,000 units in 2012.

Meanwhile, going forward, Knight Frank expects the new launches to increase by 13 per cent during H1 2016, with North and East Ahmedabad leading the way. "However, the sales volume will witness a muted growth, as homebuyer sentiment is still lackadaisical," the firm stated in its report.