Fifty-two thousand two bedroom-hall-kitchen (2bhk) flats lie unsold in the city this year, and 1.47 lakh in the Mumbai metropolitan region — up from last year's figures of 45,000 unsold ones in the city and 1.30 lakh in the MMR, says a report from Mumbai-based real estate research firm Liases Foras.
WHY ARE THE FLATS LYING UNSOLD?
Liases Foras managing director Pankaj Kapoor told dna most of the unsold flats were too unaffordable for most buyers. "Most people cannot afford to buy the roof over their heads. Either the price of houses should come down or a person's salary should increase for sales to happen. Besides, investors are putting their funds into equity rather than investing in real estate projects. The reason is they are getting better returns in equity than in real estate. The scenario will remain the same for at least two years," said Kapoor. The average size of a two bedroom-hall-kitchen flat is pegged at 1000 sq ft.
ARE REAL ESTATE PRICES FALLING, THEN?
No. Prices have stagnated, not dropped. Kapoor said, "In the past year, only 1% price rise took place. The prices are maintaining their level but it is not a good sign for the property market. The property sale should be at least three times as high so as to keep the economy growing," said Kapoor.
WHICH CITIES ARE IMPACTED THE MOST AND WHICH THE LEAST?
The number of new flats built dropped by 7% from previous quarter. Of the new supply, 36% was in the cost range of Rs 50 lakh to Rs 1 crore, and 29% was in the range of Rs. 25 Lakh to Rs 50 Lakh.
Added together, the property sales in six cities including Delhi and Bengaluru fell by almost 25% over the last quarter. This was the lowest sales figure recorded since 2009, said the Liases Foras report.
The report further stated that sales were down even in productive markets such as Bengaluru and Chennai. "Bengaluru's sales were down by 43% and Chennai's by 46% from the previous quarter. The national capital region (NCR) sales also declined further by 34% in this quarter while Mumbai Metropolitan region showed a marginal decline in sales by 9%," said the report.
ARE CHEAPER FLATS IN SMALLER CITIES SELLING WELL?
The Hyderabad market showed an improvement in sales by 29% and the Pune market by 4%. As per the report, flats costing Rs. 50 lakh- Rs. 1 crore accounted for 34% of these sales.
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