Covid impact: Home sales drop 66% across nine key cities in June quarter

The supply of new housing units also decreased by 81% during the period to 11,967 units from 63,535 units in Q1 2020, as developers hardly launched any projects, with sales coming to a standstill

Sales or absorption of housing units dropped by 66 per cent across nine top cities in India in the second quarter of calendar 2020, to 21,294 units from 62,851 units in Q2 2019, according to a report by PropEquity.

The sales fell primarily as restrictions were imposed by the government across the country to stop the spread the of Covid-19.

The supply of new housing units also decreased by 81 per cent during the period to 11,967 units from 63,535 units in Q1 2020, as developers hardly launched any projects, with sales coming to a standstill.

While most cities recorded significant declines in new launches, Noida was the only one in which there were absolutely no new launches in Q2. Of the remaining eight cities, Chennai and Kolkata reported the biggest slump in new project launches, at 92 per cent each, while Bengaluru posted the smallest decline, at 45 per cent. The other five cities in the list include Gurugram (81 per cent drop in new launches), Hyderabad (79 per cent), Mumbai (85 per cent), Thane (88 per cent) and Pune (73 per cent).

Most of the new launches in other cities took place after the lockdown restrictions were relaxed by May third week.

“These are unprecedented times for the world economy and India is one of the hardest hit due to the epidemic. The real estate sector which was slowly reviving in March was hit by a complete halt in construction and sales in the last week of March. We believe larger developers with low debt leverage will ride the storm and do reasonably well by Q3 onwards within the context of the new normal," said Samir Jasuja, founder and managing director, PropEquity. 

He added that the industry might see resizing of units, discounts, amenities and special payment schemes offered by developers to create demand, especially during the upcoming festive season.

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