DELHI: The inventory of unsold homes in the top cities has risen 4.85% in the January-March quarter to 7,34,000 apartments from just over 7,00,000 apartments in the previous quarter on the back of tepid sales and over 700 new residential projects being launched across the country, says a report by property research firm Liases Foras.
It would take at least 31 months for developers to sell this stock at the current rate of absorption. A healthy market, however, would maintain inventory for just eight months.
There was a silver lining for some markets though: sales of homes in the quarter were up 22% in Pune, 17% in Mumbai and 8% in Chennai. Other markets such as the National Capital Region (NCR), Bangalore and Hyderabad posted a decline in quarter-onquarter sales, with Hyderabad slipping the most at 24%. NCR was down 1% while Bangalore was down7%.
"Buyers seem to be still waiting for the economy and affordability to improve and a strong government could do the trick," says Pankaj Kapoor, managing director of Liases Foras.
Home sales have been slow across the country for the last few quarters because of a stuttering economy and a dismal job scene. Also, high cost of loans, rising property prices, nagging inflation and economic and political uncertainty have pushed many home buyers to defer their purchases.
Developers are pinning their hopes on a strong, decisive government to assume power at the Centre post elections, which might prompt many fence-sitting customers to take the plunge.
The January-March 2014 quarter saw over 700 new launches across markets, more than half coming up in the Mumbai Metropolitan Region and the NCR, said the report. New supply increased 48% in
Chennai and 53% in the MMR compared to the previous quarter while Hyderabad saw a drop of 69% in new supply. NCR too was down, but marginally, at 4%. Almost 35% of the new apartments launched were in the Rs 25-50 lakh price bracket while 32% were in the Rs 50 lakh to Rs 1 crore category, said the report.