Housing prices have declined by 7 per cent in the national capital region (NCR) and by 2 per cent in the Mumbai Metropolitan Region (MMR) in the last one year, indicating a tepid residential market for the sector reeling under the worst ever slowdown.
"Prices have come down marginally because of some discounts given by developers and owing to new launches in lower price brackets. The weighted average price remained unchanged across the top eight cities," Pankaj Kapoor, MD and founder of real estate consultancy Liases Foras said.
The weighted average price among the top eight cities of India remained stagnant at Rs 6783 per sq ft during the period while the unsold inventory stood at 42 months, implying that it will take three-and-a-half years for the existing unsold inventory to clear up, according to data from Liases Foras.
"An efficient market maintains 8 to 12 months of inventory. An inventory overhang of 42 months indicates pressure on prices across all the major cities in India," Kapoor added.
The average price in NCR was Rs 4578 per sq ft in the June quarter compared to Rs 4913 in the year-ago period. For MMR, the price declined from Rs 13044 to Rs 12754 per sq ft.
Tier-I cities have recorded sales of 69,485 units in the June quarter, exhibiting a marginal increase of 2 per cent compared to the last quarter when the sales were 68,222 units.
Four out of eight Tier-I cities witnessed an increase in sales this quarter. The maximum growth was observed in Chennai (9 per cent) followed by Bengaluru (8 per cent) while the maximum dip was witnessed in Kolkata where sales were down by 9 per cent.
Nearly 54 per cent sales in June quarter were contributed by the sub-Rs 50 lakh segment, supported by government schemes and initiatives. The segment accounted for more than one-third (38 percent) of total units launched during the quarter.
The government has been doling out incentives for homebuyers in the affordable segment, from lower interest rates to subvention schemes. Under the PM Awas Yojna (PMAY), households with an annual income of up to Rs 18 lakh can avail Rs 2.3 lakh upfront as subsidy for a home.
Top eight cities witnessed new launches of 65,111 units during the first quarter of FY19-20, a dip of 12 per cent from Q4 FY19. Only NCR and Ahmedabad witnessed an increase in new launches during the quarter while rest of cities saw a decline. The highest number of new launches in the quarter were noticed in MMR (20,108) with 31 per cent contribution to overall new launches in top eight cities followed by Pune (14,616 units) and NCR (9,555 units), Liases Foras said.