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Housing Launches Rise in Bengaluru, Mumbai & Delhi-NCR
By PropertyGeld Editorial Team
Published on PropertyGeld:
Residential Market Shows Signs of Recovery
India's residential real estate market showed signs of improvement in 2018 after several years of relatively weak activity. Bengaluru, Mumbai and Delhi-NCR recorded increases in both new housing launches and sales during the year.
The improvement was associated with the changing regulatory environment, particularly the implementation of RERA and GST, which brought greater formalisation and transparency to the property market.
New Housing Launches Increase
Among the three major markets, Delhi-NCR recorded the largest percentage increase in new residential launches during 2018.
Market | New launches in 2017 | New launches in 2018 | Growth |
|---|---|---|---|
Bengaluru | 20,657 | 37,286 | 81% |
Mumbai | 32,842 | 39,970 | 22% |
Delhi-NCR | 8,247 | 17,660 | 114% |
The figures are based on JLL Research. The Delhi-NCR figures included Delhi, Gurugram, Noida-Greater Noida, Ghaziabad and Faridabad, while the Mumbai market included Mumbai, Thane and Navi Mumbai.
Sales Also Improved
Residential sales increased across all three markets.
Market | Sales in 2017 | Sales in 2018 | Growth |
|---|---|---|---|
Bengaluru | 24,980 | 29,140 | 17% |
Mumbai | 24,383 | 26,858 | 10% |
Delhi-NCR | 14,440 | 24,725 | 71% |
Delhi-NCR recorded the largest year-on-year increase in sales. However, the report noted that the percentage growth was partly influenced by the relatively low sales base of the previous year.
Delhi-NCR Housing Market
The NCR residential market experienced a significant increase in project launches during 2018.
Gurugram and Ghaziabad were among the areas that contributed strongly to the increase in new supply. Noida continued to account for a substantial portion of NCR launches, although its share declined compared with the previous year.
In terms of sales, Gurugram, Noida-Greater Noida and Ghaziabad were important contributors to the recovery in the region.
Bengaluru Property Market
Bengaluru recorded an 81% increase in new residential launches during 2018.
New activity was seen across several micro-markets, including central and eastern parts of the city as well as Kanakapura Road.
Kanakapura Road was gaining attention because of improving connectivity, availability of land and comparatively competitive property prices.
For sales, Hosur Road and Whitefield together accounted for more than half of Bengaluru's residential sales during the year.
Mumbai Residential Market
Mumbai recorded a 22% rise in new launches during 2018.
Navi Mumbai and western suburbs such as Malad, Kandivali, Borivali and Dahisar saw considerable development activity.
Infrastructure projects, including metro expansion, the coastal road and suburban railway improvements, were among the factors supporting developer interest in different parts of the Mumbai region.
On the sales side, areas including Thane, western suburbs and eastern suburbs continued to contribute substantially. South-central Mumbai, including Parel, Byculla, Matunga and Wadala, also recorded notable growth in sales during the year.
Property Prices Remained Relatively Stable
Despite the increase in new launches, property prices across the three markets remained relatively stable.
The report attributed this partly to the presence of unsold inventory and the relatively slow demand seen during the preceding years.
Average residential prices cited in the report were approximately:
Bengaluru: ₹4,150 per sq ft
Mumbai: ₹10,669 per sq ft
Delhi-NCR: ₹4,690 per sq ft
These are 2018 figures and should not be used as current property prices.
Impact of RERA and GST
The implementation of RERA and GST was viewed as an important factor behind the changing residential market environment.
RERA introduced greater regulatory oversight of real estate projects, while GST changed the taxation structure for property transactions.
The report indicated that these reforms, combined with improving consumer sentiment, contributed to the recovery observed in the three markets during 2018.
What the 2018 Trend Indicated
The increase in both launches and sales suggested that the residential sector was gradually recovering after a prolonged period of weaker activity.
However, the rise in supply also meant that developers still had to deal with existing unsold inventory. Stable property prices and improving sales were therefore important for reducing inventory levels over time.
Conclusion
The 2018 residential property market showed a noticeable improvement across Bengaluru, Mumbai and Delhi-NCR.
Delhi-NCR recorded the highest percentage growth in both new launches and sales, while Bengaluru experienced a substantial increase in launches and Mumbai saw moderate growth.
The data reflects the 2018 market conditions, not the current real estate situation.
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