Housing sales hike 25%; new supply down 22% in 9 cities in 2018: PropTiger

Housing sales are estimated to have increased by 25 per cent this year at 310,000 units in nine major cities of the country, driven by improved demand especially for affordable homes, according to PropTiger.com.

The nine cities tracked by News Corp-backed PropTiger are -- Mumbai, Pune, Noida, Gurgaon, Bengaluru, Chennai, Hyderabad, Kolkata and Ahmedabad.

Last year, housing sales were hit due to lingering adverse impact of note ban, the new realty law RERA that came into effect from May 2017 and the GST implementation.

"The downslide in home sale numbers has been arrested and the sector has moved out of bottom of sales cycle. Since building within the deadline is mandatory under the real estate law, completion rate of housing projects has improved, too," it said in a yearly-round up for the housing market.

On new supply, the realty portal said that only 1.9 lakh new units were launched in 2018, down 22 per cent from the previous year.

The developers exercised caution in launching new projects as they have to strictly follow deadlines under the provisions of the new real estate law RERA. Liquidity crunch and unsold stocks also restricted new supply.

As per data, the Mumbai Metropolitan Region (MMR) alone will sell more than 100,000 units in 2018, 34 per cent higher than the previous year. Pune is also reporting an increase of 47 per cent in sales in 2018 over the previous year.

Both the cities benefited from a proactive real estate regulator, it added.

Southern cities also recorded increase in sales volume compared to previous year. In north, Noida has shown improvement in sales on the back of price cut undertaken by most developers.

"Combination of drop in new launches and improvement in sales has brought down inventory overhang to the lowest in the past five years. Currently, we have only 29 months of unsold inventory at aggregate level of the nine cities.

"There will be over 750,000 apartment and villa properties available for sale with developers in the top 9 cities as on December 2018. Unsold inventory decreased by 14 per cent in 2018 as compared to 2017," PropTiger said.

The company noted that the Indian real estate sector has undergone a massive transformation in the past two years on the policy front. 2018 has been the year of implementation and adaptation by the stakeholders of these policy changes.

On outlook for next year, it said that: "First half of 2019 will see India going through the general elections, which might have an impact on the sector. Launches are bound to be low, with sales stagnating or seeing minor improvements over the last year. Developers will prefer to focus on selling inventory in existing projects and completing construction.