The residential real estate market continues to face headwinds with a steep fall of 43% year-on-year in new launches across the country in March. The huge decline came on the back of uncertainty in respect of GST rates and also liquidity crisis, resulting in 6% y-o-y fall on an overall basis to 286 million sq feet in FY 2019.
Nonetheless, during the same month i.e. March 2019, sales registered a 10% y-o-y increase with total sales hitting 37.3 million sq ft. on a pan India basis. So, total sales in FY19 grew 7% y-o-y to 443 million sq ft.
At the same time, prices also surged higher to 5,260 per sq ft in comparison to 4950 per sq ft in March 2018, up 6% year-on-year.
As per a report by Kotak Institutional Equities, decline in new home launches as well as improving sales sentiment have helped in clearing the unsold inventory, which has fallen on a PAN-India basis by 11% y-o-y to 1,230 million sq ft in March 2019. Further, the outstanding inventory is estimated to be liquidated in 33 months time in comparison to 40 months in March 2018.
Launches remained steady in the NCR region in comparison to other metros at 3.7 million sq ft during the month under review.
In Mumbai Metropolitan Region (MMR), new home launches declined 49% y-o-y to 2 million sq ft in March 2019 as launches in Thane registered a slowdown. Also, decline in new launches in Mumbai by 35% y-o-y resulted in the overall fall in the region.