The side effects of demonetisation slowly fading away: Report
Knight Frank India launched the eighth edition of its half yearly report - India Real Estate in which it presented an analysis of the residential and office market performance of MMR for the period July–December 2017 (H2 2017). The report stated that the residential real estate market i
Published -
Jan 11, 2018 4:45 AM
Knight Frank India launched the eighth edition of its half yearly report - India Real Estate in which it presented an analysis of the residential and office market performance of MMR for the period July–December 2017 (H2 2017). The report stated that the residential real estate market is slowly coming out of the woes of demonetization. There is an uptick compared to a lower base recorded during the demonetization quarter, the performance was also helped by the implementation of RERA and effective 10-15% price correction across key markets. However, it still remains tepid as it shows a drop of 28% compared to the last quarter of 2015 when these markets cumulatively recorded sales of 71,820 units. The sales for the second half of 2017 across the markets including Mumbai Metropolitan Region, National Capital Region, Bangalore, Pune, Chennai and Hyderabad have declined 2 per cent from a year ago to 107,316 units. “The harsh effects of demonetisation have come down with time. Stakeholders are showing more confidence with the reforms such as the Real Estate (Regulation and Development) Act, 2016 and GST.” said Shishir Baijal, CMD, Knight Frank India to Realty Plus. Office transactions also fell by 10 percent to 18.1 million sq ft in the first half of 2017. The 5 percent decline in supply saw 17.9 million sq.ft added to the office space inventory. At 12 percent, vacancy levels were at the lowest since 2012 when it was 21 percent. Except Mumbai and NCR, vacancy levels were low in other cities. Vacancy levels at prime CBDs in Mumbai and NCR were in single digits, the report said. New launches across all these markets, witnessed a drop of 21% and 70% compared to December quarter of 2017 and 2015, respectively. Dr. Samantak Das, Chief Economist & National Director – Research said, ““For the first time in this decade the Mumbai market has experienced a drop in residential prices. In terms of sales the Mumbai market recorded 19% uptick in H2 2017 over the demonetisation-hit same period last year, however overall sales volumes reflect a declining pattern. The office market has witnessed newfound buoyancy with new completions recording double digit growth for the first time since 2012.
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