New housing project launches decline by 44% in Q2 2012- C&W

Key points discussed below are;

- Sharp decline of 73% in new project launches in Mumbai

- Pune recorded the highest number of launches accounting for nearly 37% of the total new supply

- Bengaluru records highest Capital values increase : North Bengaluru (mid-range) increase by 13%

- Noida surpasses Gurgaon in the number of new units launched

Mumbai, 01 August, 2012: In a recently released report, Global real estate consultancy, Cushman & Wakefield (C&W), reported that an estimated 17500 residential units were launched  by organised developers in the second quarter of 2012 in major cities across the country, registering a decline of nearly 44% over the previous quarter. This decline in launches can be attributed to a number of factors such as delay in approvals, significant inventory in certain locations as well as postponement of project to coincide new launches with the festival season.

Pune was among the few cities that saw an increase in number of launches. Given the inherent demand in the city it also recorded the highest number of launches accounting for nearly 37% of the total new supply.

Of the 17,500 units launched 70% catered to the mid segment as it continues to see maximum demand from end users and investors.

According to C&W, the residential sector witnessed steady demand across almost all the major cities with capital values in majority of the micro markets remaining stable across high end and mid end segment properties.

Meanwhile, the luxury housing segment continued to witness demand with a few high value transactions being concluded in cities like Mumbai and NCR. Some of the prominent micro markets that recorded appreciation include Gurgaon - NCR, in which the luxury segment witnessed a rise of 10% in capital values. Prime high-end locations such as Central Bengaluru, Far North in Mumbai, South Kolkata also recorded an increase in capital values of 11%, 9%, and 6% respectively, indicative of steady demand.

Capital values of mid segment properties in almost all the cities also remained largely stable during the quarter with a few exceptions such as North and South-west Bengaluru recording an increase of 13% and 10% respectively; Powai in Mumbai recording an appreciation of 12% in 2Q 2012. 

Shveta Jain, Director, Residential Services Cushman & Wakefield India said "Going forward, we anticipate an improvement in the economic scenario will provide the much needed impetus to boost the demand. Values are expected to remain stable in the short term and the developers may also offer attractive options and incentives to attract buyers during the festive season."