While overall market sentiment for purchasing residential property remains weak, there is enough interest for new launches from organised developers with a strong execution track record, finds an ICICI Securities’ report
Listed developers have lined up a slew of launches and activation schemes to coincide with the festive season in Q3 FY20, says a report by ICICI Securities, titled 'Residential Real Estate: Action heats up in festival season'.
In value terms, the Mumbai Metropolitan Region (MMR) and National Capital Region (NCR) account for 70 percent of stuck projects and have seen the largest number of unlisted developers fading away. This paves the way for larger players to capitalise even in a weak market, the report noted.
With mortgage rates hovering between eight to nine percent and developers focusing largely on the mid-income or affordable housing segment to drive volumes, the brokerage expects strong traction in sales volumes in H2 FY20.
Though it acknowledges weak market sentiment for purchasing residential property, it sees enough interest for new launches from leading, organised developers with a strong execution track record.
Homebuyers have become discerning over the last couple of years with a number of unlisted developers grappling with high debt, funding crunch and stalled projects.
Oberoi Realty recently launched the 180-unit Maxima tower in JVLR (Andheri) with an average ticket size of Rs 35-40 million and potential sales value of over Rs 7 billion. Oberoi’s Goregaon Phase 3 and Thane launches are also expected in Q3 FY20, which will further boost sales.
Godrej Properties (GPL) has already begun marketing new launches from September itself. Its major launches include Godrej Nirvaan at Kalyan, Mumbai and Godrej Nest in Kandivali (E) in Mumbai’s western suburbs.
Sunteck Realty expects to launch Phase 3 of ODC, Goregaon by January 2020 and second phase of Naigaon affordable housing project around Diwali. The recent Andheri (W) project acquisition is also slated for Q4 FY20.
DLF, which remains the only serious listed player in the NCR market, is expected to shortly launch subsequent phases for sale in its New Gurugram (Manesar) projects in October.
South India players to continue with launches and activations: Unlike the MMR and NCR markets, the south India market continues to see stable demand with developers largely focusing on mid-income and affordable housing launches. Prestige Estates has lined up its annual activation event called Keys 2019.Brigade Enterprises is launching new phases of its existing projects such as El Dorado and Cornerstone Utopia in addition to the Brigade Showcase event in the Middle East along with a Dusshera Home Fest in Mysore. Sobha will be releasing new inventory in its existing projects along with new launches across south India.The Great Diwali Discount!
Unlock 75% more savings this festive season. Get Moneycontrol Pro for a year for Rs 289 only.
Coupon code: DIWALI. Offer valid till 10th November, 2019 .