Real Estate sector results preview for Q4FY12: P Lilladher

Prabhudas Lilladher has come with its March quarterly earning estimates for Real Estate sector. As per the research firm, the scenario continues to remain grim across markets in the Residential segment. Most markets are seeing a built-up in inventory on account of the lacklustre sales environment.

Macro challenges have continued for the sector during the quarter. There has been no respite from the Central bank so far, with the RBI maintaining status quo on rates in their last monetary policy announcement.

The extent of the problems faced by the extant of the problem facing the Mumbai commercial market can be gauged from the recent special offer from Hubtown. Hubtown is offering offices in their three completed properties viz Solaris, Viva and Star at 40% down payment, while the rest is to be paid over the next 60 months (1% per month). This clearly illustrates the challenging demand scenario and consequent liquidity pressures plaguing developers.

Residential

The scenario continues to remain grim across markets in the Residential segment. Most markets are seeing a built-up in inventory on account of the lacklustre sales environment.

Mumbai City Sales registrations continue to languish; they were down 11% YoY in February 2012 at 4203. With a slew of launches being witnessed recently, the impact of these on the market prices will need to be watched, given the depressed sales environment in the city. Interestingly, rentals have also moved down in certain pockets like Central Mumbai, indicating high