As per a survey by the property consultant JLL India, about 4.4 lakh housing units remained unsold in seven major cities at the end of 2017 with Delhi-NCR contributing maximum at over 1.5 lakh flats. The consultant is expecting high level of unsold inventories to result in stabilization of housing prices.
The seven cities covered in this survey include Mumbai, Delhi-NCR, Chennai, Hyderabad, Pune, Bengaluru and Kolkata. Out of this total unsold housing inventory, the consultant said, 34,700 units are ready-to-move-in flats.
Delhi-NCR has the highest volume at around 1,50,654 units which remained unsold in 2017, while Chennai has the highest percentage of completed unsold inventory at close to 20 per cent. Kolkata had the lowest volume of unsold inventory at about 26,000 units.
JLL India CEO and Country Head Ramesh Nair said: "The residential market has been on a wait and watch mode for some time on account of many structural changes that have happened."
The whole lot of changes such as the coming into being of the real estate law RERA, demonetisation and GST have led to a general slowdown in overall construction activities as well as housing demand.
"We expect sales velocity to start picking pace in the second half of the year mostly on account of stable prices making entry attractive," Nair said.
With significant volume of unsold inventory, JLL said the capital values across most markets will be kept buyer friendly to ensure sales velocity.
"...with a slowdown in launches, across the markets, we can expect to see more unsold inventory to get absorbed in the next few quarters," it said.
The consultant noted that buyers now prefer to enter the market closer to date of completion, which further accelerates absorption of the unsold units.
"Capital values remain stable with a downward bias across most markets making it buyer favourable," JLL said.
As per the survey report, the Delhi-NCR property market saw the highest volume of unsold inventory of 1,50,654 units spread across the perimeter of Delhi, Gurgaon, Ghaziabad, Faridabad, Noida and Greater Noida. Upon analysis, Noida and Greater Noida together contributed to nearly 60 per cent of the total unsold inventory, mostly in under-construction projects.
"Noida and Greater Noida have had a tumultuous past because of which, end users are circumspect in making their purchases," JLL said.
Mumbai has about 86,000 unsold units and Bengaluru nearly 70,000 units while Pune has 36,000 unsold flats. Hyderabad has unsold inventories of about 28,000 units.