NEW DELHI: The real estate market in the country's top eight cities recorded a 320% year-on-year jump in affordable home launches in the quarter to June, according to a report by property advisory Cushman & Wakefield, indicating a shift in strategy by builders to beat the slump.
Developers launched 7,000 affordable units in the period against 1,670 in the year-ago quarter, the report said. Of these, 60% or 4,251 units were launched in the National Capital Region, which comprises Delhi and nearby cities such as Faridabad, Gurgaon, Ghaziabad and Noida.
"Strong emphasis on affordable housing by the government and the growing demand has motivated a spurt in affordable housing projects across the country," said Shveta Jain, executive director-residential services at Cushman & Wakefield.
New launches across all housing categories saw a 144% rise in Delhi-NCR at 6,900 units, the report said. However, in the first half of 2015, Delhi-NCR witnessed a 28% year-on-year drop in launches to 9,700 units.
Gurgaon witnessed a number of launches under the Haryana government's affordable housing policy. The housing scheme of Delhi Development Authority also received a large number of applications.
"Presumably, these instances highlighted the demand for housing in affordable segment, which the private developers are targeting at," said Jain. Peripheral submarkets like Noida Extension, Yamuna Expressway in Noida and Sohna in Gurgaon are now established as affordable destinations in Delhi-NCR. The June quarter saw the launch of four projects in Sohna and Noida Extension in the range of Rs 30-50 lakh.
The real estate market in India has been witnessing a slump in demand for the last couple of years due to high home loan rates and severe liquidity crunch among developers.
The RBI has reduced the rates thrice this year, but banks have been reluctant to pass on the benefits to consumers. A recent report by industry lobby FICCI and property consultancy Knight Frank India showed that the sentiment among stakeholders in real estate industry has moved into the negative zone for the first time since the Lok Sabha elections in mid-2014.
Total projects launched in Delhi-NCR remained consistent at nine in the June quarter. However, a 14% decline was noted in the number of projects launched in the first half of 2015.