New home launches plunge 78% in 2017 from 2010 peaks

Mumbai, Jan 10 (PTI) Reforms like the Rera and GST andalso the note-bank impact led to a steep decline in homelaunches in 2017, which plunged a full 78 per cent, say asurvey.According to a study by property consultants KnightFrank, homes launches in 2017 plummeted by staggering 78 percent 1,03,570 units. In the peak of the realty boom in 2010saw as much as 4,80,424 units being launched.New launches across the eight key metros of Mumbai,Delhi-NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata andAhmedabad, declined 41 per cent in the second half of 2017 to40,832 units from 68,702 units in the same period in 2016."By the end of 2017, the residential sector had shrunkto a fraction of its size in less than a decade. Neverthelessthe near-standstill triggered by the note-ban seems to havetapered with time," Knight Frank India chairman Shishir Baijalsaid in the report.During the second half of the year gone-by, Hyderabadrecorded the steepest fall at 84 per cent. The other IT/ITeSdominated markets like Pune, Bengaluru and Chennai fell by 58,37 and 33 per cent, respectively, compared to the same periodin 2016.Sales declined marginally to 1,07,316 units in thesecond half of 2017 from 1,09,159 in the comparable period in2016. But from the sales peak of 2011 when 3,68,568 units weresold, this is a step decline of 62 per cent in 2017 at2,28,072 units."Select markets wherein Rera has matured, have seendevelopers re-launch projects at attractive prices which ledto an uptick in sales in 2017. This strategic switch bydevelopers led to a price reduction in most markets. It's abuyers' market today and, we hope the momentum holds steady inthe near future," Baijal added.The report notes that for the first time, the sectorwitnessed price correction in 2017. "The Delhi-NCR, Mumbai,Kolkata, Bengaluru, Chennai and Pune saw prices falling by 2-7per cent, while in Ahmedabad and Hyderabad this was 2 and 3per cent, respectively," it said.In case of office space, new completions increased 7per cent in 2017 to 32.7 million sqft compared to 30.7 millionsqft in 2016, but not at par with demand."Supply grew 13 per cent to 12.5 million sqft compared to 11.1 million sqft in 2016, and the report blamed the headwinds in the technology sector and supply crunch for this subdued growth".

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