Foreword Residential Real Estate Market Q QUARTERLY REPORT INDIA RESIDENTIAL MARKET Q3-2016

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1 Foreword Residential Real Estate Market Q QUARTERLY REPORT INDIA RESIDENTIAL MARKET Q3-2016

2 Foreword Residential Real Estate Market Q Foreword Whether the real estate industry has finally bottomed out still remained unanswered during the third quarter of Tier I cities witnessed a drop of approximately 20% during Q3, in spite of builders offering attractive discounts. New launches witnessed some momentum mainly due to the festive season. The top 7 cities in India noted a launch of about 37,512 new residential units, an increase of about 14 percent over the previous quarter. Mumbai Metropolitan Region witnessed the maximum number of launches and accounted for about 23% of the total units followed by National Capital Region, Pune and Bangalore with about 22%, 19% & 16% respectively. However, the increase in new launches did not correspond to higher sales velocity. Unsold units in top cities touched all time high at 7.5 lakh units, which will take nearly 4-5 years to be absorbed. Capital prices of the residential launches remained more or less stable in this quarter. Developers have acknowledged the fact that the revival of real estate majorly depends on the performance of affordable segments which is also in-line with the government s vision of housing for all by This is evident from the fact that in the top 7 cities approximately 59 % of the projects launched are under the segment, followed by Mid, and Ultra segments. Though we have seen a prolonged spell of gloom in the real estate industry, it seems to be getting better by each passing quarter. The prices in most of the markets have now corrected sharply, RERA is all set to ease buyer s apprehensions about project delays and approvals. Banks too have sent a clear signal that they will bring down the interest rates in the coming future. With an increasing inventory of ready to move in units, consumers will soon start picking such units and hopefully we will see a gradual revival of the sector in coming quarters. Prashant Kumar Thakur Head of Research & Data Services prashant.thakur@quikr.com 1

3 Executive Summary Residential Real Estate Market Q Executive Summary In the third quarter of 2016, the top 7 cities in India witnessed a launch of about 37,512 new residential units, recording an increase of about 14 per cent as against the preceding quarter. All the tracked cities witnessed a rise in new launch supply with an exception of Mumbai Metropolitan Region (MMR) and Hyderabad. Despite recording a dip in the new launch supply, MMR witnessed maximum launches and accounted for nearly 23 percent of the total units in the third quarter, followed by National Capital Region (NCR), Pune and Bangalore with about 22, 19 and 16 percent respectively. Out of all the tracked cities, Kolkata and NCR witnessed a whopping 157 and 81 percent increase respectively in the new launch supply as against Q The demand for affordable housing has seen a significant rise in the last couple of years. The numbers clearly indicate that developers are also cashing on this opportunity by launching projects in the budget-friendly segment. As per our research, affordable properties clearly dominated the property spectrum across cities. Nearly 59 per cent projects were launched under affordable segment, followed by mid, luxury and ultra-luxury. Unsold inventory has been doing the rounds for quite some time now. At present, there is about 7.5 lakh unsold units in the country. NCR is leading this show followed by MMR, Bangalore and Pune. It is estimated that it will take more than 4-5 years to clear this unsold stock. Thus, developers are offering discounts and freebies across cities to attract fence-sitters to take the plunge. However, QuikrHomes data suggests that most of the sales are happening in either ready-tomove-in projects or projects that are nearing completion. Talking about the rental scenario, Bangalore, Hyderabad and Chennai have recorded an upward movement in their respective regions of growth. Additionally, there has been a huge restructuring in the residential markets Kolkata and Pune due to increased IT/ITeS activity. The trend of adjusting the residential rental demand along the satellite townships (Navi Mumbai and Thane regions in Mumbai and Gurgaon and Noida along with Ghaziabad in Delhi-NCR) have also been noted in NCR and MMR. 2

4 No. of Units Launched Pan India Residential Real Estate Market Q Pan India New Unit Supply Top 7 Cities 14,000 12,000 10,000 8,000 6,000 4,000 2,000 - Bangalore Chennai Hyderabad Kolkata MMR NCR Pune Q Q Q Fig 1: Residential new launch supply trend for the financial year 2016 among major metro cities. The third quarter ended on an optimistic note with all the metro cities recording a substantial growth in the new launch supply with MMR and Hyderabad being only exceptions. With the implementation of the Real Estate Regulatory Act (RERA) and piling unsold stock, developers in MMR were seen focusing more on completing their existing projects rather than launching new ones. Kolkata seemed to be in the revival mode with more focused and planned growth towards the eastern suburbs (Rajarhat/ New Town regions) with the advent of IT industry and proximity to the International Airport. Despite huge unsold inventory, Delhi NCR is outgrowing residential launches at a consistent pace. This can be attributed to the expanding urban diaspora and ample availability of land parcels in the industrial areas of Greater Noida towards south-east and Dharuhera towards south-west. Falling along the ambitious Delhi-Mumbai Industrial Corridor (DMIC), these areas are likely to see increased development in the times to come. Similarly, northern and western Pune (adjoining the Mumbai-Pune Expressway) saw large-scale residential projects due to expanding IT/ITeS, industrial, automobile and manufacturing hubs. Just to throw a number, in Q Pune recorded an increase of 50 per cent in the new launch supply as against Q Traditionally being end-user markets, unlike other metros, Bangalore and Chennai were stable in terms of supply. 3

5 Weighted Average Price of Launches (price psft.) Pan India Residential Real Estate Market Q Weighted Average Price Top 7 Cities 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Bangalore Chennai Hyderabad Kolkata MMR NCR Pune Q Q Q Fig 2: Weighted average price trend for the year of 2016 among major metro cities Property values of the residential units remained more or less stable in this quarter. Q has seen a clear domination of affordable projects resulting in a price drop as against the last two quarters. MMR was the only region to witness majority launches in mid and luxury segment. Chennai has maintained the average price level with majority launches in mid (32 per cent) and luxury segment (37 per cent). With active growth of IT/ITeS in the southern region, the city has witnessed rich appetite for luxury projects. In a stark contrast to other cities, Delhi NCR recorded a 30 per cent drop in the average price level. This, however, can be attributed to increasing number of projects with affordable units along Dadri, Tech Zone IV and Knowledge Park 5 in Greater Noida and Dharuhera region. 4

6 Unsold Stock (no.of dwelling units) Thousands Pan India Residential Real Estate Market Q Unsold Stock - Top 7 Cities Bangalore Chennai Hyderabad Kolkata Pune Delhi-NCR MMR Fig 3: Volumes of unsold residential stock among major metro cities The unsold stock has touched an all-time high with approximately 7.5 lakh units available in the primary market at the different stages of construction. High property prices, low sales velocity, execution delays and subdued residential demand are the major reasons behind this. Among all the cities, NCR is the worstaffected followed by MMR, Bangalore and Pune. The residential supply has surpassed demand in these top cities resulting in a huge piled up stock. It is estimated that it will take more than 4-5 years to clear this current stock. Out of the total unsold stock, nearly 25 per cent is skewed in the southern cities. At present, Bangalore has about 1.17 lakh unsold inventory as significant number of under-construction projects are unsold in the primary market. On the flipside, buyers are more inclined towards buying readyto-move-in projects to avoid execution delays and litigation issues. Hyderabad has the lowest unsold stock among top cities. Political instability kept developers away from this market until the bifurcation dust settled. However, despite unsold inventory, offloading it is expected to take more than 3 years. 5

7 Bangalore Residential Real Estate Market Q Bangalore City Residential Overview Fig 4: Map showing important localities along with infrastructural overview of Bangalore Bangalore saw a decent number of residential launches in Q as compared to the last two quarters with marginal slowdown in residential sales. The city is also riding high on several infrastructural upgrades. Driven by the IT/ITeS sector, micromarkets in southern and eastern Bangalore retained their spots as prominent residential hubs. Whitefield is the key market in the East with a good number of under-construction projects. Interestingly, heightened interest was seen in North Bangalore which resulted in 16 per cent of the new residential supply in Q Presence of the International airport coupled with IT and commercial developments along the Hennur Main Road can be mainly attributed towards this. 6

8 Supply (no.of dwelling units) Bangalore Residential Real Estate Market Q Zone Wise New Launches As always, south Bangalore ruled the roost with maximum supply followed by east Bangalore. Electronic City, Chandapura- Anekal Road and Kanakapura Road were the top micro-markets in the former region, while Sarjapur Road, Marathahalli, Hoodi and KR Puram topped the latter region. Interestingly, a good number of projects were also launched in North Bangalore, especially along the Hennur Main Road Central Bangalore East Bangalore North Bangalore South Bangalore Fig 5: Zone-wise distribution of supply - Bangalore AML Classification of New Launches As against Q2 2016, the number of new launches in the affordable segment has recorded an upward trend in Q These affordable units are majorly concentrated near Chandapura-Anekal Road. Electronic City has been a major focus market this quarter for both affordable and mid-segment projects with developers such as Kolte Patil and Patel Realty Group launching their projects. Mid 28% 6% Ultra 2% 64% Fig 6: Residential supply segmentation - Bangalore Key Micro Market Prices Table 1 Key residential markets - Bangalore Locality W. Average Price as on Q (INR) Average Rental Price for 2BHK (INR) Whitefield 4,100-5,400 15,000-18,000 Sarjapur Road 4,000-6,450 15,000-22,000 Kanakapura Road 3,580-5,850 9,000-15,000 Electronic City Phase I 3,000-5,100 11,000-18,000 Hebbal 5,200-6,750 12,000-21,000 Yelahanka 3,600-5,710 9,000-15,000 7

9 supply (no.of dwelling units) Thousands Bangalore Residential Real Estate Market Q Key Launches of the Quarter (Q3-2016) Expat Group contributed about one fourth of the affordable residential supply in Q3 2016, while Kolte Patil Developers contributed nearly one third in the mid-segment. Table 2 Key Launches of the quarter - Bangalore Property Segment Project Name Locality Approx. Units Approx. Price (Rs per sq.ft.) Approx. Sizes (sq.ft) Mid Expat Vida (Expat Group) Skylark Dasos (Skylark Mansions Pvt Ltd) Kolte Patil itowers Exente (Kolte Patil Developers Ltd) Chandapura- Anekal Road Hennur Main Road 1, Electronic City bhk:27.55L 2,2.5bhk: L 3,3.5bhk: L 1bhk: 25.83L 2bhk: 39.34L 3bhk: L 1bhk: L 2,2.5bhk: L 3bhk: L 4bhk: Cr 889 1,114-1,157 1,373-1, ,213-1, ,116-1,235 1,529-1,693 2,046-2,770 Mid Vaswani Menlo Park (Vaswani Group) Marathahalli 330 2bhk: L 3bhk: L 1,120-1,140 1,525-1,815 Habitat Eden Heights (Habitat Ventures) Hoodi bhk: L 3,3.5bhk: 94.53L-1.3Cr 1,398-1,447 1,768-2,021 Key Micro Market - Based on new launch supply - Quarter 3 (2016) Chandapura-Anekal Road emerged as the showstopper with highest number of launches (1,000 units) at a base selling price of Rs 3,100 per sq. ft. The stretch has also recorded steady price appreciation over the past few quarters. The proposed infra upgrades like the metro link from Electronic City to Chandapura Circle, constriction of 6-lane road and the Intermediate Ring Road have together upped the ante of this stretch turning it into a hotspot for affordable and mid-segment projects. Zone Wise Under construction Supply East South North West Central Bangalore Bangalore Bangalore Bangalore Bangalore Fig 7: Zone-wise distribution of under construction stock - Bangalore East and South Bangalore have maximum under-construction supply with a total of 2.21 Lakh units, contributing nearly 67 per cent to the total under-construction supply in the city. These two zones are preferred by denizens primarily due to the proximity of IT/ITeS hubs and constantly improving social infrastructure. North Bangalore boasts of about 54,830 under-construction units. With the upcoming Hardware Park and improved connectivity via proposed Peripheral Ring 8

10 Bangalore Residential Real Estate Market Q Road, the region has lately come under the radar of developers. West Bangalore, still lags behind but is slowly gaining momentum in real estate development. Rental Data Analysis - Top 5 Micro Markets Table 3 Top 5 rental markets - Bangalore Market Rental Listings Volume Avg. Monthly Rentals (2bhk) Whitefield ,500 J.P. Nagar ,000 Bannerghatta ,000 BTM Layout ,682 HSR Layout ,000 In line with new launch supply, eastern and southern markets also dominated the rental market in the city. In the south, JP Nagar, Bannerghatta, BTM Layout and HSR Layout were the top performers, while Whitefield topped in the East. A healthy rental demand was also observed in the central parts of the city such as Koramangala and Indiranagar with several established commercial and retail hubs, making it more desirable for the youngsters. Realty Updates The 65 km long Peripheral Ring Road (PRR) connecting Tumkur Road with Hosur Road has been granted in-principle approval after 30 years. Clearance from State-level Environment Impact Assessment Authority (SEIAA) is made mandatory for builders constructing high-rise projects covering an area of 20,000 sq.mt. or townships and area-development projects spreading over more than 50 hectares. Approvals for new real estate projects in and around Bellandur Lake (within Palike limits) to be rejected by BBMP, BDA following the interim order by court. Bangalore Metro Rail Corporation Limited (BMRCL) initiated track laying process at KR Market and Sampige Road underground Metro stations. After the passing of orders by National Green Tribunal (NGT) and the ongoing demolition drive by the Karnataka state government, there is a slowdown in property sales as homebuyers are pondering on whether to invest in properties in the city. 9

11 Chennai Residential Real Estate Market Q Chennai City Residential Overview Fig 8: Map showing important localities along with infrastructural overview of Chennai The Chennai market seems to be in revival mode after the floods last year. The city witnessed a healthy residential supply this quarter as against the preceding quarters. interesting to note that the city has homogeneous distribution of projects among different price segments unlike other cities. There is an increased focus on infrastructural development with the selection of Chennai for the first phase of Smart City development. The residential market was more oriented towards the south with infrastructure scaling along the East Coast Road (ECR) and Old Mahabalipuram Road (OMR). Chennai s market is primarily driven by mid and luxury segments with a rich appetite for premium projects. It is This was followed by West Chennai owing to availability of large land parcels in the vicinity of the industrial hubs. 10

12 Supply (no.of dwelling units) Chennai Residential Real Estate Market Q Zone Wise New Launches South Chennai dominated the new launch supply in Q with majority of the launches in the mid and luxury segment. This part of the city has an infrastructural advantage over its counterparts along with better accessibility to the central parts of the city. This was followed by western part of the city with a healthy supply of projects with affordable units North Chennai South Chennai West Chennai Fig 9: Zone-wise distribution of supply - Chennai AML Classification of New Launches 37% Ultra 3% 28% Mid 32% Chennai has equal distribution of projects in affordable, mid and luxury segments with luxury taking the lead (37 percent) followed by mid-segment (32 percent) and affordable projects. Majority of the projects with affordable units are lined up in the west with the advent of new suburban avenues and proximity to the industrial hubs. Fig 10: Residential supply segmentation - Chennai Key Micro Market Prices Table 4 Key residential markets - Chennai Locality W. Average Price as on Q (INR) Average Rental Price for 2BHK (INR) Old Mahabalipuram Road 4,200-5,400 12,100-16,500 Guduvancheri 2,810-3,780 7,000-13,000 Oragadam 3,000-4,500 6,500-9,000 Pallikaranai 4,000-5,500 9,000-15,000 Perumbakkam 3,435-4,875 10,000-15,000 Sholinganallur 4,800-5,600 12,500-16,000 11

13 Chennai Residential Real Estate Market Q Key Launches of the Quarter (Q3-2016) Table 5 Key launches of the quarter - Chennai Property Segment Project Name Locality Approx. Units Approx. Price (Rs per sq.ft.) Approx. Sizes (sq.ft) Colorhome Poonamalle Farms (Colorhomes) Sobha Winchester (Sobha Developers Ltd.) Casa Grande Alandur II (Casa Grande Private Ltd.) Poonamalle 405 Kovilambakka m 344 Alandur 328 2bhk: 20L 3bhk: 45L 4bhk: 55L 1bhk: L 2bhk: Cr 3bhk: Cr 2bhk: 90L 3bhk: Cr 4bhk: Cr 543 1,200 1, ,500-1,600 1,790-2,826 1,250 1,550-1,960 2,500-2,650 Urban Tree Fantastic (Urban Tree Infrastructure Pvt Ltd) Vanagaram 300 1bhk: 22.92L 2bhk: L 3bhk: 48.73L ,414 1,250 Mid Casa Grande Madhavaram (Casa Grande Private Ltd.) Madhavaram 232 2bhk: L 3bhk: L 4bhk: 90.67L 1,050-1,200 1,400-1,600 1,950 Key Micro Market - Based on new launch supply - Quarter 3 (2016) Poonamallee, in the west, has been an extensively active affordable market this quarter, with over 400 unit launches at a base selling price of Rs 5,219 per sq. ft. Proximity to IT hubs, good road connectivity, and robust infrastructure are the major factors driving the residential market growth here. Moreover, growing techies in the region has influenced developers to launch affordable units in the region. Zone Wise Under construction Supply supply (no.of dwelling units) Thousands South Chennai West Chennai North Chennai Central Chennai Fig 11: Zone-wise distribution of under construction stock - Chennai Majority of the under-construction units, 97 per cent to be precise, are concentrated in the south and west micro-markets of the city. IT/ITeS and industrial establishments coupled sound infrastructure have boosted these regions realty prospects. Due to shortage of developable land and high prices, central Chennai maintained its status of being the most sought-after residential destination. Sound social infrastructure, availability of Grade-A office space and enhanced connectivity to the other parts of the city have been the major catalysts driving growth in this region. 12

14 Chennai Residential Real Estate Market Q Rental Data Analysis - Top 5 Micro Market Table 6 Top 5 rental markets - Chennai Market Rental Listings Volume Avg. Monthly Rentals (2bhk) Velachery ,700 Porur ,000 Chromepet ,500 Thiruvanmiyur ,800 Madipakkam ,900 Majority of the rental activity in Q was skewed in the southern part of the city along the markets of Velachery, Porur, Chromepet, Thiruvanmiyur, and Madipakkam. The concentration of the IT industry in these regions have been a major driving factor for rentals. Interestingly, rental demand was at par with the supply. Markets such as Thiruvanmiyur, Mylapore, Purasawalkam and Porur witnessed maximum demand for rental accommodation in the third quarter. Realty Updates Regulation of real estate sector to kick start with RERA coming into reality. State regulatory authority are being set up to penalise the realtors on delaying housing projects. Tamil Nadu Slum Clearance Board to construct 23,476 tenements and individual houses during the current financial year. Chennai industrial estate s civic maintenance and infrastructure work will now be controlled by Greater Chennai Corporation. As a part of Coimbatore and Chennai smart city projects, Rs 200 crore grant has been released and special purpose vehicles have been established. 13

15 Delhi-NCR Residential Real Estate Market Q Delhi-NCR City Residential Overview Fig 12: Map showing important localities along with infrastructural overview of Delhi-NCR Delhi NCR was among the most happening residential markets of the country with a humongous addition of developable land along with an integration of transport facilities aiding the sprawl. Immense potential for development has helped Greater Noida and Yamuna Expressway attract several developers to launch their projects here in this quarter. With new avenues (Dharuhera, Bhiwadi, Palwal, Yamuna Expressway) adding up to the urban development bounds, an aggressive supply trend was noticed in these markets. Gurgaon and Noida were the other two satellite towns with high commercial concentration apart from the central CBD in New Delhi pulling both developers and investors to these markets. Ghaziabad, which saw a good number of affordable launches in the past, recorded a slight dip in the contribution to the new supply in this quarter. 14

16 Supply (no.of dwelling units) Delhi-NCR Residential Real Estate Market Q Zone Wise New Launches Greater Noida emerged as the showstopper with 43 per cent new supply, followed by Noida and Gurgaon with 26 and 20 per cent respectively. While the former market boasted of launches in the affordable segment, the latter two recorded majority launches in the mid and luxury segment Fig 13: Zone-wise distribution of residential supply - Delhi-NCR AML Classification of New Launches The segment dominated the property spectrum in Delhi NCR with about 77 per cent, followed by mid and luxury segments with 12 and 11 per cent respectively. Interestingly, majority of the projects in the affordable segment were launched in Dharuhera, Greater Noida and Bhiwadi where the property values are still realistic. While the concentration of mid and luxury properties were seen towards the commercial hubs of Noida and Gurgaon. Mid 12% 8% Ultra 3% 77% Fig 14: Residential supply segmentation - Delhi-NCR Key Micro Market Prices Table 7 Key residential markets - Delhi-NCR Locality W. Average Price as on Q (INR) Average Rental Price for 2BHK (INR) Sector-79 (Gurgaon) 4,800-5,400 NA Sector-143 (Noida) 4,500-5,200 10,000-15,000 Sector-79 (Noida) 4,200-4,800 NA L Zone (Delhi) 3,000-4,500 NA Raj Nagar Extension (Ghaziabad) 3,200-3,600 7,500-10,000 Yamuna Expressway (Greater Noida) 2,550-4,050 6,000-11,000 Noida Extension (Greater Noida) 2,760-4,030 7,000-10,000 15

17 supply (no.of dwelling units) Thousands Delhi-NCR Residential Real Estate Market Q Key Launches of the Quarter (Q3-2016) Table 8 Key launches of the quarter - Delhi-NCR Property Segment Project Name Locality Approx. Units Approx. Price (Rs per sq.ft.) Approx. Sizes (sq.ft) Ajnara Khel Gaon (Ajnara India Ltd) Dadri 1,150 2bhk: L 3bhk: L ,195-1,395 SKA Green Arch Sector-16, Noida 944 2bhk: 21.80L 3bhk: L 1,000 1,220-1,600 Pivotal Paradise (Pivotal Infrastructure) Sector-62, Gurgaon 760 1bhk: 12.41L 2bhk: 23.09L 3bhk: 25.82L Nirala Estate II (Nirala World) Tech Zone IV, Greater Noida 720 2bhk: L 3bhk: L 4bhk: 73.66L 955-1,180 1,245-1,745 2,320 ATS Picturesque Reprieves (ATS Infrastructure Ltd) Sector-152, Noida 700 3bhk: 1.11Cr 4bhk: 1.52Cr 2,350 3,200 Key Micro Market - Based on new launch supply - Quarter 3 (2016) Dadri in Greater Noida recorded the maximum new launch supply in contrast to the negligible number of launches in the previous quarter. A whopping 1,150 units were launched here at a base selling price of Rs 2,740 per sq. ft. Connectivity with Noida-Greater Noida Expressway coupled with the ongoing expansion of the metro rail have been the major growth drivers for Dadri. Moreover, there is also an integrated industrial township project that is being developed. Zone Wise Under construction Supply Fig 15: Zone-wise distribution of under construction stock - Delhi-NCR Majority of the under-construction units in NCR are lying in Greater Noida, Gurgaon and Noida with Greater Noida leading the show with 40 percent units. Out of the total, about 30 per cent underconstruction units in Greater Noida were launched during As per the micro-markets, Yamuna Expressway and Noida Extension are the biggest contributors. 16

18 Delhi-NCR Residential Real Estate Market Q Rental Data Analysis - Top 5 Micro Markets Table 9 Top 5 rental markets - Delhi-NCR Market Rental Listings Volume Avg. Monthly Rentals (2bhk) Indirapuram ,000 Patel Nagar ,300 Kalkaji ,000 Chattarpur ,500 Uttam Nagar ,650 Ghaziabad recorded maximum rental activity followed by Delhi in Q Indirapuram and Sector 12 were the prominent micro-markets in Ghaziabad, while Patel Nagar, Kalkaji, Chattarpur, Uttam Nagar and Dwarka evolved as top performers in Delhi. However, a slight mismatch was noticed in the rental demand as the eastern and western suburbs of Delhi like Laxmi Nagar, Uttam Nagar and Vikas Puri recorded higher rental demand. Realty Updates Redevelopment of seven housing colonies was approved through National Buildings Construction Corporation Limited (NBCC) and Central Public Works Department (CPWD). The housing stock is set to increase from 12,970 to 25,667 units. A committee formed by North Delhi Municipal Corporation, led by top officials including an additional commissioner to inspect and demolish illegal construction activities. DDA is planning to bring in world-class landscaping parks inspired by the likes of Hyde Park in London, New York s Central Park, and Garden by the Bay in Singapore. Areas spreading over 100 acres in sizes have been shortlisted in west and north-west of Delhi. NGT ordered the municipal corporations and other authorities to levy environmental compensation on construction sites based on their size for causing dust pollution. A 20,000 sq.mt. site would be liable to pay Rs 5 lakh, 100 sq.m site to pay Rs 10,000 and sq.m site is subjected to pay Rs 20,000 and so on. Ghaziabad Development Authority to initiate the revision of the existing master plan Population projections, satellite survey of the city, land-use survey, transportation survey and other required surveys to be undertaken to prepare the revised master plan. 17

19 Hyderabad Residential Real Estate Market Q Hyderabad City Residential Overview Fig 16: Map showing important localities along with infrastructural overview of Hyderabad Hyderabad has lately emerged as a preferred destination for investment with growing commercial establishments. In this quarter, however, there has been a marginal dip in the new launch supply. High construction activity in the western region (Cyberabad) has put tremendous strain on the region that has resulted in the huge unsold stock. Interestingly, there has been an increase in the new launch supply in North Hyderabad. 18

20 Supply (no.of dwelling units) Hyderabad Residential Real Estate Market Q Zone Wise New Launches West Hyderabad leads the show with the most number of launches in the city largely focused on luxury and ultra-luxury segments pivoted around the IT/ITeS hubs. This quarter, interestingly, has also seen noticeable launches in the North (Miyapur and Kowkoor) in the affordable and midsegments. These northern markets are largely driven by the spillover demand from the nearby commercial centres of western Hyderabad where property prices have shot up significantly East Hyderabad North Hyderabad West Hyderabad Fig 17: Zone-wise distribution of supply - Hyderabad AML Classification of New Launches Hyderabad has recorded maximum supply in the mid-segment, followed by properties in luxury segment. With growing demand for mid and luxury properties, the affordable segment has taken a back seat this quarter. 25% Ultra 15% 12% Mid 48% Fig 18: Residential supply segmentation - Hyderabad Key Micro Market Prices Table 10 Key residential markets - Hyderabad Locality W. Average Price as on Q (INR) Average Rental Price for 2BHK (INR) Gachibowli 3,255-5,210 10,000-17,000 Hi Tech City 4,100-5,000 11,000-18,000 Madinaguda 2,800-3,800 9,500-15,000 Hafeezpet 3,200-4,000 9,000-14,000 Tellapur 3,500-5,180 11,000-14,500 Kondapur 3,500-4,500 11,000-15,000 19

21 Supply (no.of dwelling units) Thousands Hyderabad Residential Real Estate Market Q Key Launches of the Quarter (Q3-2016) Table 11 Key launches of the quarter - Hyderabad Property Segment Project Name Locality Approx. Units Approx. Price (Rs per sq.ft.) Approx. Sizes (sq.ft) Ultra- Muppas Indraprastha (Muppa Projects Pvt Ltd) Western Exotica (Western Constructions) Vishnu Vistara (Vishnu Group) Tellapur 300 4bhk: Cr 3,379-4,500 Kondapur 270 2bhk: L 3bhk: Cr 1,290-1,473 2,200-2,813 Hi-Tech City 240 3bhk: 86.32L-1.15Cr 1,730-2,310 Mid Sai Keerthi Prime (Sai Jyothi Constructions) Chanda Nagar 220 2bhk: L 3bhk: 47.60L 1,120-1,200 1,400 Mid Silpa RV dharmista (R V Nirmaan Pvt Ltd) Miyapur 206 2bhk: L 3bhk: L 1,160-1,230 1,555-1,770 Key Micro Market - Based on new launch supply - Quarter 3 (2016) Located in West Hyderabad, Kondapur has recorded maximum new launch supply in Q at a base selling price of Rs 2,668 per sq.ft. A total of 450 units were launched in both mid and luxury segment. Kondapur has gained momentum due to its proximity to Gachibowli and Hitech City. Moreover, steady demand for residential properties from both investors and end-users have attracted many developers to this area. Zone Wise Under construction Supply West North South East Central Hyderabad Hyderabad Hyderabad Hyderabad Hyderabad Fig 19: Zone-wise distribution of under construction stock - Hyderabad As expected, the western part of the city accounts for the largest share of underconstruction inventory, followed by the north, south, east and central markets. Just to throw a number, approximately 43,070 units are under-construction that are likely to be completed in the next 3-4 years. Out of the total under-construction supply, North Hyderabad accounted for about 19 percent. South, Central and East Hyderabad are the silent zones in terms of under-construction supply in the city. 20

22 Hyderabad Residential Real Estate Market Q Due to the presence of grade A office spaces and premium micro-markets such as Jubilee Hills and Banjara Hills, central Hyderabad also recorded decent underconstruction supply in Q Rental Data Analysis - Top 5 Micro Market Table 12 Top 5 rental markets - Hyderabad High rental availability was recorded in and around major commercial and retail hotspots such as Madhapur, Ameerpet, Market Rental Listings Volume Avg. Monthly Rentals (2bhk) Madhapur ,600 Banjara Hills ,000 Gachibowli ,700 Ameerpet ,000 Tolichowki ,200 Gachibowli, and Tolichowki among others. Much of the rental demand is augmented around the commercial hubs of the city and the adjacent residential markets such as Hitech City, Gachibowli, Kukatpally, Madhapur, and Manikonda. Realty Updates With the saturation of the existing financial district, plans are being made by the Telangana government to develop a new financial district spread over a 50 acres in the next six to nine months. For the Hyderabad metro rail to become operational, 1,200 properties are yet to be acquired in Sultan Bazaar, Ameerpet, Jubilee hills and Secunderabad areas. Cisco Systems along with its technology solution partner Paradigm Mtuity is set to implement a pilot project under the Hyderabad Smart City project. Development plans for Phase II expansion of Hyderabad Metro Rail network to be taken up by collaboration of Hyderabad Metro Rail Limited and Delhi Metro Rail Corporation An American data firm is planning to open its largest office in the world spreading over an area of 8.6 lakh sq.ft. With a lease rental of Rs 800 crore for 15 years and planning to hire 7,000 employees for Hyderabad office alone. 21

23 Kolkata Residential Real Estate Market Q Kolkata City Residential Overview Fig 20: Map showing important localities along with infrastructural overview of Kolkata Kolkata is seeing a trend shift from industrial to IT/ITeS sector. There has been a growing interest of several multinational companies in area like New Town and Rajarhat that offers better infrastructure along with proximity to the International Airport. 22

24 Supply (no.of dwelling units) Kolkata Residential Real Estate Market Q Zone Wise New Launches East Kolkata (New Town, Rajarhat, certain parts of Garia, VIP Nagar) saw the maximum new launch supply in this quarter due to increased focus on planned infrastructure. This was followed by North Kolkata with emerging micro-markets offering affordable alternatives with enhanced connectivity via metro rail and suburban railway system. Central Kolkata stood last with no new launches indicating a saturation in the residential markets Kolkata Central Kolkata East Kolkata North Kolkata South Kolkata West Fig 21: Zone-wise distribution of residential supply - Kolkata AML Classification of New Launches Mid 23% 7% Ultra 1% 69% Figure 22 Residential supply segmentation - Kolkata As per the market segmentation, affordable properties clearly ruled the roost. The city of joy has been on revival mode with several residential and commercial projects lined up along the New Town region in the east. With a developing IT sector, this region has huge potential for price appreciation in the times to come. Key Micro Market Prices Table 13 Key residential markets - Kolkata Locality W. Average Price as on Q (INR) Average Rental Price for 2BHK (INR) Rajarhat 3,900-4,800 11,500-15,000 EM Bypass 5,900-6,700 12,000-22,000 Maheshtala 3,000-3,500 7,000-10,000 Behala 3,500-4,000 8,000-11,500 Garia 3,400-4,000 8,000-11,000 23

25 supply (no.of dwelling units) Thousands Kolkata Residential Real Estate Market Q Key Launches of the Quarter (Q3-2016) Table 14 Key launches of the quarter - Kolkata Property Segment Project Name Locality Approx. Units Approx. Price (Rs per sq.ft.) Approx. Sizes (sq.ft) Usashi Prince Town (Usashi Realstates Pvt Ltd) New Town 800 2bhk: 16.71L 3bhk: L 840 1,027-1,145 Mid Ideal Aurum (The Ideal Group) Sonarpur 486 2bhk: L 3bhk: L RCBS Realty Roopkatha (RCBS Realty Pvt Ltd) Baruipur 320 1,1.5bhk: L 2,2.5bhk: L Sanjeeva Tower (Vedic Realty Ltd) Rajarhat 224 2bhk: L 3bhk: L 4bhk: 1.0Cr 1,260-1,355 1,522-1,691 1,967-1,978 Diadem Anandamath Kalyani 200 1bhk: 8.49L 2bhk: 12.49L Key Micro Market - Based on new launch supply - Quarter 3 (2016) New Town in East Kolkata was the key micro-market in this quarter with 885 new units launched at a base selling price of Rs 3,145 per sq. ft. A fast developing market, New Town boasts of well-planned streets, large green spaces and an amalgamation of physical as well as social infrastructure. Zone Wise Under construction Supply East Kolkata South Kolkata North Kolkata West Kolkata Central Kolkata Fig 23: Zone-wise distribution of under construction stock - Kolkata East Kolkata accounts for a major share of under-construction units with 34 percent, followed by the South, North, West and Central Kolkata. Rajarhat and New Town together constitute about 18,435 underconstruction units, which is highest in the city, mainly attributed to the increased commercial activity in these regions. South Kolkata accounts for nearly 26 percent of under-construction supply. 24

26 Kolkata Residential Real Estate Market Q Majority of the real estate development in the region is happening in peripheral areas such as Narendrapur, Garia, Rajpur Sonarpur and Amtala-Baruipur Road. Approximately 20 percent of underconstruction supply hailed from the North Kolkata. Once known as an industrial hub, today has emerged as one of the most preferred residential destinations. Micro markets such as BT Road, Jessore Road and Madhyamgram have witnessed project launches from reputed developer in the last few years. Rental Data Analysis - Top 5 Micro Market Table 15 Top 5 rental markets - Kolkata Market Rental Listings Volume Avg. Monthly Rentals (2bhk) Dum Dum ,500 Rajarhat ,500 Keshtopur ,500 Salt Lake City ,500 Tollygunge ,500 Aggressive commercial developments along the New Town region have boosted the rental availability in markets such as Rajarhat, Keshtopur, DumDum and Salt Lake City, among others. Interestingly, rental demand was also at par with availability and major demand was recorded in eastern areas of Salt Lake City, Rajarhat and VIP Road, among others. Realty Updates Large-scale housing projects covering an area of 2 lakh sq. ft should get a green approval before starting construction. Though the calculation of property tax is now simplified and promises to lessen the tax burden for flat owners, the process to avail the opportunity is not easy. Binani Group, the 143-year old business conglomerate is set to invest Rs 10,000 crore in cement, power and infrastructure, including ports, in Bengal. 25

27 Mumbai Metropolitan Region Residential Real Estate Market Q Mumbai Metropolitan Region City Residential Overview Fig 24: Map showing important localities along with infrastructural overview of MMR Mumbai Metropolitan Region (MMR) is another residential agglomeration with two major satellite cities (Navi Mumbai and Thane) aiding the growth of the residential market along with commercial establishments. Thane developed largely as an alternative to the expanding residential activity in the city. Navi Mumbai s development, on the contrary, was more planned as it was taken up by the authority. 26

28 Supply (no.of dwelling units) Mumbai Metropolitan Region Residential Real Estate Market Q Zone Wise New Launches Thane and beyond are the most active residential markets in MMR with the highest number of new launches in Q These markets have evolved as an alternative to the central suburbs resulting in high residential demand. Navi Mumbai has also seen significant launches in both affordable and mid-segments with planned infrastructure development Mumbai Beyond Thane Thane West Navi Mumbai Mumbai Mumbai Harbour Western Suburbs Thane Mumbai Mumbai South Central Suburbs Fig 25: Zone-wise distribution of residential supply - MMR AML Classification of New Launches The third quarter saw majority of the launches in affordable and mid-segment categories. This can be attributed to the fact that Navi Mumbai and Thane recorded maximum new launch supply in this quarter where property values are still realistic. The central suburbs continued to be dominated by premium residential options. Mid 58% 1% Ultra 1% Affordabl e Fig 26: Residential supply segmentation - MMR Key Micro Market Prices Table 16 Key residential markets - MMR Locality W. Average Price as on Q (INR) Average Rental Price for 2BHK (INR) Dombivli East 5,870-6,400 10,500-15,000 Virar West 4,700-5,100 7,000-10,000 Mira Road 6,000-8,640 13,000-20,000 Panvel 4,280-6,980 8,000-14,000 Taloja 4,000-4,500 8,000-10,000 Kharghar 7,200-7,800 11,000-14,500 Ghodbunder Road 8,800-9,150 14,000-22,000 27

29 supply (no.of dwelling units) Thousands Mumbai Metropolitan Region Residential Real Estate Market Q Key Launches of the Quarter (Q3-2016) Table 17 Key launches of the quarter - MMR Property Segment Project Name Locality Approx. Units Approx. Price (Rs per sq.ft.) Approx. Sizes (sq.ft) Mid Godrej Emerald (Godrej Properties Ltd) Ghodbunder Road 1, bhk: 75L 2bhk: 97.50L-1.12Cr 3bhk: Cr Palava-Codename Golden Tomorrow (LODHA Group) Dombivli East 1,200 1bhk: 37.35L 2bhk: 50.22L 3bhk: 57.96L Mid Xrbia Axtria (XRBIA Developers) Richa SRA (Richa Realtors) Panvel 1,100 Chembur 1,000 Mid Tycoons Goldmine Kalyan West 500 2bhk: 47.00L 3bhk: 60.95L 1.5bhk: 66.00L 2bhk: 1.01Cr 3bhk: 1.32Cr 1bhk: 39.63L 2bhk: L 3bhk: L 1,000 1, ,150 1, ,230 1,648-1,652 Key Micro Market - Based on new launch supply - Quarter 3 (2016) Ghodbunder road in Thane West boasts to be a preferred investment destination under the residential category. As many as 1400 new units were launched in this quarter with one of the highest base selling price in MMR region at Rs per sq.ft. The Ghodbunder road stretches approximately 20 km long and the development in this region is very rapid resulting in launch of both affordable and premium properties by reputed developers. The selling points of this locality is that the road links two main arterial roads of Mumbai (Eastern Expressway and Western Expressway). The upcoming MGM IT park and other corporate organizations and proposed monorail is an additional advantage to this locality. Zone Wise Under construction Supply Mumbai Beyond Thane Mumbai Western Suburbs Mumbai Mira Road & Beyond Mumbai Central Suburbs Mumbai Harbour Mumbai South Navi Mumbai Thane Fig 27: Zone-wise distribution of under construction stock - MMR 28

30 Mumbai Metropolitan Region Residential Real Estate Market Q MMR is currently sitting on nearly 4 lakh under-construction inventory, out of which 25 per cent comes from the Thane region. High property prices and unavailability of land banks within the city limits have shifted developers interest to the peripheral areas such as Dombivali, Badlapur, Vangani and Kalyan. Navi Mumbai is sitting on about 73,179 under-construction units. Micro-markets such as Panvel, Taloja and Kharghar contributed more than 60 percent of under-construction supply in the city. About 14 per cent under-construction units were skewed in the western suburbs. Rental Data Analysis - Top 5 Micro Market Table 18 Top 5 rental markets - MMR Market Rental Listings Volume Avg. Monthly Rentals (2bhk) IIT Powai ,000 Kharghar ,000 Andheri West ,000 Naigaon ,500 Andheri East ,000 Increasing employment opportunities have been a major driver fueling rental housing demand in the city. Powai, Kharghar, Andheri East & West and Naigaon were the top markets that recorded maximum rental availability. Maximum rental demand was recorded in markets such as Andheri East, Goregaon West and Ghodbunder Road, among others. Realty Updates With new development rules coming into existence, fewer project launches and land deals will be witnessed in the Mumbai Metropolitan Region (MMR). Donald Trump, the American Republican presidential candidate and also a real estate tycoon has launched two real estate projects by name Trump Tower luxury apartments in Mumbai and Pune. An housing project has been launched by Actor Vivek Oberoi s real estate firm, Karrm Infrastructure Pvt. Ltd. Upon completion of the project, more than 15,000 families will be provided houses at a cost of Rs 7.9 lakh. Brihanmumbai Municipal Corporation (BMC) has approved 24 projects along the city s coastline around the localities of Girgaum Chowpatty, Prabhadevi, Mahim and Shivaji Park. The final approval (i.e. Stage 2 forest clearance) for clearing the tarmac for work on ground has been issued to Navi Mumbai airport. BMC proposed 10% property tax rebate scheme in which the societies who segregate waste (dry and wet) and composite it are eligible to avail the discount. 29

31 Pune Residential Real Estate Market Q Pune City Residential Overview Fig 28: Map showing important localities along with infrastructural overview of Pune Real estate development in Pune is primarily skewed towards the northern and western region. Excellent intra-city connectivity via Mumbai-Pune Expressway has significantly boosted the prospects of industrial and commercial developments in these regions of the city. Apart from north and west Pune, south Pune was also active in terms of residential developments owing to the availability of land parcels and proximity to the central markets and institutional spaces of the city. Increasing unsold inventory in the luxury segment put a break to the launch of luxury units and thus the market was dominated by affordable and mid-segment properties in this quarter. 30

32 Supply (no.of dwelling units) Pune Residential Real Estate Market Q Zone Wise New Launches Pune has lately witnessed rapid residential growth due to the development of the IT/ITeS industry. In Q3 2016, North Pune surpassed other zones with the highest new launch supply. Realistic property values, robust infrastructure and proximity to the IT and industrial hubs have been the major catalysts in fueling residential demand in this region. North Pune was followed by West and South Pune comprising nearly 28 and 18 per cent new launch supply respectively North Pune West Pune South Pune East Pune Fig 29: Zone-wise distribution of residential supply - Pune AML Classification of New Launches Properties in the affordable and midsegment dominated the property spectrum in Pune with 66 and 34 per cent respectively. segment recorded a significant dip in this quarter due to low demand, oversupply and infrastructure issues. Mid 34% 66% Fig 30: Residential supply segmentation - Pune Key Micro Market Prices Table 19 Key residential markets - Pune Locality W. Average Price as on Q (INR) Average Rental Price for 2BHK (INR) Wagholi 3,635-5,270 9,000-14,000 Hinjawadi 3,900-5,540 9,000-13,000 Undri 4,500-5,200 10,000-15,000 Wakad 5,200-7,080 12,000-18,000 Chakan 3,200-3,800 7,500-10,000 Moshi 3,430-5,200 9,000-14,000 Baner 5,800-8,430 12,000-19,000 31

33 Supply (no.of dwelling units) Thousands Pune Residential Real Estate Market Q Key Launches of the Quarter (Q3-2016) Table 20 Key launches of the quarter - Pune Property Segment Project Name Locality Approx. Units Approx. Price (Rs per sq.ft.) Approx. Sizes (sq.ft) Mid Kolte Patil R1 Life Republic (Kolte Patil Developers Ltd) Hinjewadi 1,000 2bhk: 52.00L 3bhk: 74-77L 1,030 1,487-1,545 Miracle Micron Nine (Miracle Buildtech Pvt Ltd) Alandi 600 1bhk: L 2bhk: L Mantra Essence (Mantra Properties) Undri 500 1bhk: 20L 2bhk: 34L 3bhk: 41L ,194 Mid Devi Crest (Devi Constructions) Vadgaon Maval 426 1bhk: L 2bhk: L 800-1,150 1,200-1,825 VTP Purvanchal (VTP Group) Wagholi 300 1bhk: 17.59L 2bhk: L Key Micro Market - Based on new launch supply - Quarter 3 (2016) Hinjewad in West Pune was the showstopper with maximum new launch supply. A total of 1,075 units were launched at a base selling price of Rs 4,074 per sq. ft. Constant infra upgrades and the proposal of Taj Group Hotels Resorts and Palaces to set up a businesscum-leisure hotel has further upped the ante of this micro-market. Zone Wise Under construction Supply North Pune South Pune West Pune East Pune Central Pune Fig 31: Zone-wise distribution of under construction stock - Pune North Pune recorded maximum number of under-construction supply with 33 per cent, followed by South, West, East and Central Pune. North Pune has approximately 61,407 under-construction units, out of which more than 25,000 were in micro-markets such as Chakan, Moshi, Chikhali and Talegaon. South Pune has nearly 44,830 underconstruction units that are expected to be completed in the next three years. Ample land availability, excellent connectivity to MG Road and Magarpatta City and reputed 32

34 Pune Residential Real Estate Market Q educational institutions has made it one the most preferred zones for the real estate development. West Pune boasted of about 41,048 underconstruction units with Hinjewadi, Wakad and Baner being the key micro-markets in the region. Proximity to Mumbai-Pune Expressway and the presence of commercial offices in Hinjewadi has boosted the real estate development in and around the region. Rental Data Analysis - Top 5 Micro Markets Table 21 Top 5 rental markets - Pune Market Rental Listings Volume Avg. Monthly Rentals (2bhk) Wakad ,500 Hadapsar ,500 Kharadi ,000 Katraj ,000 Baner ,450 With establishment of Industrial and IT corridors along Pimpri-Chinchwad and Hinjewadi, maximum rental activity was recorded in North-West Pune Markets with high rental availability include Wakad, Hadapsar, Kharadi and Katraj among others. Markets that recorded maximum demand were Kothrud, Wadgaon Sheri and Hadapsar among others. Realty Updates Implementation of rainwater harvesting is made mandatory in Pimpri-Chinchwad for all newly constructed residential and commercial buildings covering an area of 20,000 sq.mt. New building byelaws are framed for the residents of cantonment areas of Pune and other cities across the country. Provisions for floor space index (FSI) ratio of a building are added under these new byelaws. Taking the aid of Geographical Information System (GIS), the administration of Pune began geo-tagging of properties to boost revenues. A MoU was signed by Pune Smart City Development Corporation (PSCDCL) with European Business and Technology Centre (EBTC) to customize European technologies and promote smart city solutions for the Pune smart city project. 33

35 Outlook Residential Real Estate Market Q Outlook About per cent increase in the new launch supply in the third quarter indicates Aache din in the times to come. The Indian real estate market is likely to witness an upward trend in the coming festive months owing to which we can expect an increase in new launches and sales volume across cities. The last quarter is expected to witness at least a per cent jump in the residential new supply across cities. However, capital and rental values are expected to remain more or less stable. High unsold inventory will remain a major problem stagnating the growth of the residential market in top cities. As per the market segmentation, affordable and mid-segments are likely to lead the show in the coming quarter as well. About QuikrHomes 34

36 Outlook Residential Real Estate Market Q QuikrHomes is India s leading digital real estate business. We have the largest and most comprehensive list of detailed real estate sales and rental options covering all cities and budget categories. In the highly volatile and scattered Indian real estate market it is quite challenging to understand the dynamics and make profitable investments. We help investors to take informed decision backed by real time data. We capture real estate data across India and also update historical data of supply & absorption in top cities. To ensure the most up-to-date and detailed data availability, our dedicated team/analysts monitor property activity from a number of sources, including developers and property brokers, real estate forums and property listings, as well as our own intensive research. Our research services give clients the tools to review & analyze markets and realty insights that support successful investment strategies. The solutions we provide always cater to our clients needs as we ensure that all captured data and all customized reports undergo thorough due diligence by our in-house audit team. Services Provided: Land Potential Assessment Customized Reports Competitive Benchmarking Study Market Assessment Reports Feasibility Reports Quarterly demand Supply Analysis Report Projects Monitoring Services Tier 1 Cities Residential Projects Details with historical price & Absorption Trends. For Residential Data Services please contact Prashant Kumar Thakur Head of Research & Data Services prashant.thakur@quikr.com Quikr India Pvt Ltd Next to Manyata Tech Park, Back Gate No 5. Krishnarajapuram Hobli, Bangalore Copyright QuikrHomes CommonFloor. All rights reserved. The information provided herein is based on QuikrHomes & CommonFloor data which is collected from various publicly known sources viz, websites, documents and maps including QuikrHomes & CommonFloor's proprietary data model. Projects mentioned in the report are selected solely on basis of various parameters including number of units, price range and unique selling point, among others. The selection, omission, or content of items does not imply any endorsement or other position taken by QuikrHomes & CommonFloor. The information is provided on an "as is" and "as available" basis. QuikrHomes & CommonFloor expressly disclaim warranties of any kind, whether express or implied, including, but not limited to, the implied warranties of merchantability, fitness for a particular purpose and noninfringement. 35