MUMBAI OUTLOOK FOR THE NEXT SIX MONTHS
Going forward, we expect further improvement in demand, even though launches would be marginally lower. In H2 2015, absorption is projected to improve by 25%, to 38,936 units, and launches, to decline marginally by 3%, to 34,289 units compared to H1 2014
Notwithstanding the slowdown in sales, the weighted average prices in the MMR inched up 10% during 2014, moving from ` 7,085/sq ft to ` 7,796/sq ft. Even as demand will improve going forward, the magnitude of price growth will be low. H1 2015 will witness price growth at 4%, reaching ` 8,106/sq ft.
PUNE OUTLOOK FOR THE NEXT SIX MONTHS
We expect the number of new launches to drop further, to 13,300 units during H1 2015. The huge amount of unsold inventory of the previous quarters will compel developers to restrict the number of new projects in the coming quarters in order to liquidate the existing unsold inventory
However, the positive sentiment in the residential market due to the cut in policy rate by the Reserve Bank of India (RBI) is expected to usher in a double-digit growth in the sales volume during H1 2015. We forecast that the sales volume will increase by 13% in H1 2015, to 16,560 units, compared to 14,700 units in H1 2014.
We expect the weighted average prices in Pune to increase by a moderate 4% rate in the coming six months, on the back of the improved sales volume.
NOIDA OUTLOOK FOR THE NEXT SIX MONTHS
Due to no land allotment foreseen in the coming year, very few new project launches will happen in Noida, though project deliveries will start taking shape in the coming quarters, which might attract buyers
The Noida–Greater Noida Expressway will start witnessing project deliveries in 2015. • Ticket sizes between Rs 30 lakh and Rs 60 lakh will attract buyers to Greater Noida, while the more budget conscious buyers will be looking towards Yamuna Expressway.
BENGALURU OUTLOOK FOR THE NEXT SIX MONTHS
Office absorption in Bengaluru is expected to reduce in H1 2015,as compared to the quantum of office space leased out in H1 2014. However, this should not be considered as weakening of the market as H1 2014 had witnessed a surge in office space transactions owing to the pent up demand in the market post a cautious 2013. Thus, 2015 is envisaged to be a stable market.
Besides, a number of large lease deals, particularly by the e-commerce sector, are on the cards and the completion of the transaction procedures can spill over to the second half of 2015
This will be complemented by an increase in new completions, an improvement of 17% in H1 2015 as against the figure in H1 2014
Overall vacancy level is projected to decrease to 9.6% in H1 2015, the lowest level in the country, that can be attributed to the staggered new completions and steady absorption rate. • Going forward, the demand envisaged in the forthcoming period will have a direct impact on rentals. We expect weighted average rentals to appreciate by 11%, from Rs 47/sq ft/month in H1 2014 to around Rs 52/ sq ft/month by H1 2015.
CHENNAI OUTLOOK FOR THE NEXT SIX MONTHS
We expect the number of new launches to drop further, by one-fifth, to 9,158 units during H1 2015 as compared to 11,377 units launched in H1 2014. The huge unsold inventory of the previous quarters will impede developers from launching new projects in the Chennai market
However, for a price-conscious Chennai home buyer, the cut in policy rate by the Reserve Bank of India (RBI) and further, the dovish stance of the RBI governor, are expected to have a positive impact on the residential market. We forecast that the sales volume will increase by 10% in H1 2015, to 11,357 units compared to 10,315 units in H1 2014.
Constricted supply coupled with moderate growth in the absorption will push prices up. We expect weighted average prices for Chennai residential to increase by 4% in H1 2015
HYDERABAD OUTLOOK FOR THE NEXT SIX MONTHS
We do not expect the steep de-growth in launches and absorption to continue, because the easing of the political situation, and initiatives such as the recent rate cut by the RBI will pay dividends in time to come
We believe that launches and absorption will approach H1 2014 levels and see a deficit of 5% and 2% YOY respectively by the end of H1 2015.
Prices are also expected to grow by 5% during the same period