Slump in new launches signals subdued realty market

Posted By: Religare
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Sentiments for residential realty market remains under pressure as new launches have nearly halved in the January-March 2015 quarter given that there is an oversupply situation since last 8 quarters.

According to a report by FICCI-Knight Frank, there is a continuous fall in the new residential launches across major markets, even as sales volume remains steady.

"The ongoing lull in the residential market reflected in the lacklustre sentiment levels and the continuous fall in launches and absorption across markets. Developers have continued to restrict new residential launches owing to the oversupply scenario prevailing over the last eight quarters," Knight Frank India Chief Economist and Director - Research Samantak Das said.

The FICCI-Knight Frank Real Estate Sentiment Index for the January to March 2015 quarter, however, expects new launches to improve marginally over the next six months.

On the pricing front, majority of the developers and financial institutions anticipates prices to remain stagnant in the coming six months on the back of subdued demand.

Delhi and Mumbai are the big drivers of real estate in India and the recent political disturbance and a controversial development plan have weighed heavily on the sentiments in these cities and zones.

Story first published: Wednesday, May 6, 2015, 23:00 [IST]
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