BANGALORE: This city has over 700 residential projects comprising apartments, villas, row houses and plots amounting to 1.82 lakh units under development. An inventory of roughly 60,000 units remains unsold. Of these 80% are apartments and 10% plots, property consultant L J Hooker says.
T L J Hooker report shows that in January-June calendar of 2012, the city clocked an absorption rate of around 3,774 units a month, in line with what Bangalore absorbed post the IT boom. Since sales have slowed, the existing inventory could take 16 months to clear. “Over the last two quarters prices haven’t changed, an indication of a softening in buyer sentiment, in line with the overall economic environment,” Prashanth Sambargi, partner, Mars Realty, says.
Farook Mahmood, CMD, Silverline Group, a well-known city realtor, says while residential prices aren’t showing signs of cooling down as yet, sales are sluggish. “But Bangalore remains India’s cheapest market. For the quality one gets, it’s absolute value for money.”
L J Hooker estimates show the average price of a 2-BHK or 3-BHK flat in June-end moved up marginally by 3% over the December 2012 period. While the average per sq ft rate in December was Rs 4,432, in June it climbed to around Rs 4,556.
Nagaraj Reddy, president Karnataka chapter of real estate industry body Credai, says the city has around 600 ready-to-move in residential units priced between Rs 7,500 per sqft and Rs 10,000 per sqft. “These comprise penthouses and large 3,000 sqft-plus units that remain unsold.”
Given the rupee depreciation, Bangalore has seen a fair amount of NRI buying. While, the expectation was that NRIs would flock to pick up properties, realtors say that hasn’t yet happened.