Cushman & Wakefield: Property demand up by 27%- Business News

Cushman & Wakefield: Property demand up by 27%

During Q1 2016, the affordable segment accounted for approximately 35% of total launches which is more than last two years.

BT Online   
  • May 12, 2016  
  • |  
  • UPDATED   13:26 IST

According to property consultants Cushman & Wakefield's recent report, with the increase in demand of affordable housing segment, the first quarter of 2016 witnessed launch of approximately 31,200 units across the top eight cities in India, recording an increase of 27% year - on - year. The residential market, which saw a fall in launches in 2015, saw a remarkable comeback in the first quarter, backed by a six-fold rise in launches in the affordable housing segment which saw an addition of over 10,950 units during Q1 2016 as developers foresee greater demand in this highly price-sensitive segment.

During  Q1 2016, the affordable segment accounted for approximately 35% of total launches which is  more than 2015 and 14.. Over the last few quarters, the share of affordable housing has constantly increased as developers and investors are viewing this segment more favorably. Affordable housing segment comprise 22% of total unit launches seen in 2015, up from its share of 17% in 2014. In the same time, average launch prices have witnessed some decline across major cities, making the new projects cheaper than those launched 12- 24 months ago.

Shveta Jain, Executive Director, Residential Services at Cushman & Wakefield says, "Developers have come to realize the vast potential of that was remaining untapped in the affordable housing segment. They have now come to recognize the potential of the segment and are expecting greater momentum in demand in the affordable segment as customers are seen to be more price-sensitive in the current market. "

Mumbai witnessed a significant drop in launch prices of close to 35% in Q1 2016 as against those launched in Q1 2014. While Pune recorded a decline of approximately 25% in launch prices of new projects in the same period.

Pune also saw an increase in the average size of apartments that were launched in Q1 2016 which were noted to be larger by an average of 24% over those launched in Q1 2015 impacting the average ticket size of the new launches within the city. "With strong emphasis on affordable housing by the government, tax incentives extended by the government, as well as the cautious approach by end-users in other segments, developers are betting on the affordable segment." says Shveta.