New Delhi, February 18, 2016 –
According to CBRE’s India
Residential Market View for H2
2015, residential demand during
the review period remained sluggish, with housing sales dipping by around 17%
as compared to H1 2015.Despite price movements remaining stable, home buyer demand remained low
during the year due to existing high price points coupled with a cautious buyer
On the other hand, housing sales in the leading southern cities during
2015 continued to be driven by demand from the growing IT/ITeS workforce in the
region. Majority of the housing demand here, remained concentrated in the
high-end / mid-end segments, with limited transaction volumes noted in the
premium / luxury segments.
For the second half of the year, the top three cities of Mumbai,
Bangalore and Delhi National Capital Region (NCR) observed more than 65% of the
total housing sales noted across the country’s leading cities. Hyderabad
and Mumbai noted an uptick in housing sales during H2 2015, even as most other
housing markets saw subdued sales. While sales in Mumbai increased due to a
surge in demand across the city’s developing suburbs, political stability in
Hyderabad led to a corresponding rise in home buyer demand.
Commenting on the findings of the
report, Mr. Anshuman
Magazine, Chairman and Managing Director of CBRE, South Asia Pvt. Ltd.
said, “Despite the muted buyer interest noted in the housing market for much of
last year, I feel that 2016 holds the promise of a market revival on the back
of Government initiatives in the right direction. Apart from its renewed focus on
large scale urban infrastructure and development of affordable housing, the
Central Bank, for its part, remains accommodative towards further easing of interest
rates. I believe these moves could help spur property purchase decisions,
propelling the market forward.”
Most new housing project launches
during the second half of 2015 remained focused towards the mid-end segments,
primarily in secondary and peripheral neighborhoods of key cities. Mumbai led
new project launches during the second half of 2015, accounting for more than
35% share of the total supply of new housing units among leading cities.
Bangalore and Delhi NCR had a share of 28% and 11%, respectively, of the new
property launches seen during the period across leading cities.
“Going forward, an uptick in
home buyer demand will most likely be driven by the mid-end and affordable
housing segments in 2016, concentrated mostly across secondary and peripheral
locations of leading cities. Owing to the demand slowdown in the market and a
decided shift in home buyer expectations, developers are likely to focus on the
timely delivery of their ongoing projects. Developers are also expected to remain
increasingly flexible on pricing and payment structures, while right-sized and
well-priced projects will continue to attract demand across India’s leading
cities,” said Mr. AS Sivaramakrishnan, Head
– Residential Services India, CBRE South Asia Pvt. Ltd.
Property prices in premium /
luxury segments across leading cities remained stable—except for Bangalore and
Delhi NCR. While Bangalore saw a price rise across key micro-markets owing to
sustained demand and limited availability of premium housing units in these
locations, Delhi NCR noted a marginal pricing dip of 2–4% across select
neighborhoods. Prices across high-end / mid-end segments also remained stable
across most leading cities, except for Hyderabad and Delhi NCR.
Meanwhile, Bangalore noted a rental
value rise of 2–10% in the high-end / mid-end segments in H2 2015 over that of
the first half, along with a half-yearly rise of 5–10% in the premium / luxury
segments across select micro-markets. Delhi NCR, however, saw a marginal rental
drop of 2–3% around Greater Noida Expressway, mainly due to high availability
of apartments for rent at an affordable price range.
Neither CBRE nor its affiliated companies make any warranties or claims on the implied accuracy of the information contained herein.
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