Demand for ready-to-move-in homes rises as project delays shake buyer confidence
The share of ready-to-move-in inventory as a percentage of total sales rose to 20 per cent during the 2019-20 financial year as against 15 per cent in the previous fiscal.
Demand for ready-to-move-in housing units is rising as project delays by multiple builders have shaken the buyers’ confidence in the property market. According to a report by PropTiger, housing sales fell 11 per cent during the last fiscal year across nine major cities of the country, however, the demand for ready-to-move-in residential units rose while that of under-construction flats dipped.
“The share of ready-to-move-in inventory as a percentage of total sales rose to 20 per cent during the 2019-20 financial year as against 15 per cent in the previous fiscal,” the report stated.
As per the data, total housing sales during the last fiscal stood at 3,22,667 units across nine cities, nearly 11 per cent down from 3,62,021 units sold in the 2018-19 fiscal. However, the sale of completed units rose to 64,386 units last fiscal from 53,908 units in the 2018-19 fiscal, but the demand for under-construction apartments dipped to 2,58,281 units in the 2019-20 fiscal, from 3,08,113 units in the previous year.
It may be noted that PropTiger tracks property markets in nine cities, including Ahmedabad, Bengaluru, Chennai, Gurugram (includes Bhiwadi, Dharuhera and Sohna), Hyderabad, Kolkata, Mumbai (includes Navi Mumbai and Thane), Pune and Noida (includes Greater Noida, Noida Extension and Yamuna Expressway).
The report stated that in line with expectations, the demand for ready-to-move-in residential properties is growing as customers have become risk-averse because of uncertainties involved in the completion of under-construction flats. The share of ready-to-move-in residential properties in the overall housing sales is expected to increase and may reach 30 per cent during this fiscal.
“Housing demand remained subdued during FY’20 because of the slowdown in the country’s economic growth. The global outbreak of coronavirus during the January-March quarter added to the woes faced by the Indian real estate sector over the last few years. Housing sales are generally higher in the second half of the fiscal and hence the impact of COVID-19 was more pronounced,” said Dhruv Agarwala, Group CEO, PropTiger, Housing and Makaan.
“With under-construction projects likely to be delayed because of the nationwide lockdown, we strongly believe that customers’ preference towards completed units will further strengthen,” he added.