The real estate residential property is selling like hot cakes in the cities like Chennai, Bangalore & Gurgaon. But, Mumbai is cold.
The absorption rate is the number of flats sold in a month from the available inventory in a market. It is an indicator of the demand situation in a particular real estate market.
Mumbai Fell..!
During the calendar year 2011, Mumbai (including Navi Mumbai & Thane) saw 6,650 flats sold each month against 9,092 in 2010. This is citing a report by global bank JP Morgan. This means, the absorption rate fell 27%t.
Every property market has an inventory of flats. If the absorption rate is high, the inventory gets exhausted quickly. With the absorption rate in Mumbai falling, it will take 2 years to sell the unsold inventory.
Property trends in 5 major cities are explained below:
MUMBAI
JP Morgan expects prices to correct in Mumbai only when some new residential projects are launched.
Now, high prices are keeping buyers away. Over the last 12 month, residential prices in Mumbai have remained flat.
In pockets like central Mumbai & North Mumbai, they have increased by 10%. New project launches fell 50%t during the calendar year 2011.
NOIDA:
The residential absorption rate in Noida fell 31% in 2011. In Greater Noida, it fell even further at 56%. This indicates a sharp slump in demand due to a weak buyer sentiment given the recent political change that could impact project approvals or new launches.
In Greater Noida, construction progress of launched projects has also slowed down in the market due to contraction of funds by banks or NBFCs. Average property prices in Noida rose 6%.
GURGAON:
The residential absorption rate in Gurgaon rose 11% in 2011. This is largely due to a high launch activity in the market. Property prices in the market rose 17% during the year.
Unsold inventory in the market remains at healthy 9 months of average absorption. This means the demand for houses in Gurgaon is much higher than Mumbai.
BANGALORE:
The residential absorption rate in Bangalore grew 19% in 2011. This was primarily driven by large affordable (low cost) launches done by major buliders and developers. Price appreciation now seems to be catching up in Bangalore with completed or nearing completion projects witnessing 10 to 15% appreciation over the past few months.
New launches in Bangalore rose 56% in 2011. Average property prices rose up to 24% across key real estate pockets during the same period.
CHENNAI:
The residential absorption rate in Chennai rose 37% in the 2011. High launch activity has resulted in increased unsold inventory in the market. Unsold inventory rose to 15 from 10 months early last year. Average property prices rose 8% to 30 % in pockets from Anna Nagar to Rajeev Gandhi Salai (OMR)
The absorption rate is the number of flats sold in a month from the available inventory in a market. It is an indicator of the demand situation in a particular real estate market.
Mumbai Fell..!
During the calendar year 2011, Mumbai (including Navi Mumbai & Thane) saw 6,650 flats sold each month against 9,092 in 2010. This is citing a report by global bank JP Morgan. This means, the absorption rate fell 27%t.
Every property market has an inventory of flats. If the absorption rate is high, the inventory gets exhausted quickly. With the absorption rate in Mumbai falling, it will take 2 years to sell the unsold inventory.
Property trends in 5 major cities are explained below:
MUMBAI
JP Morgan expects prices to correct in Mumbai only when some new residential projects are launched.
Now, high prices are keeping buyers away. Over the last 12 month, residential prices in Mumbai have remained flat.
In pockets like central Mumbai & North Mumbai, they have increased by 10%. New project launches fell 50%t during the calendar year 2011.
NOIDA:
The residential absorption rate in Noida fell 31% in 2011. In Greater Noida, it fell even further at 56%. This indicates a sharp slump in demand due to a weak buyer sentiment given the recent political change that could impact project approvals or new launches.
In Greater Noida, construction progress of launched projects has also slowed down in the market due to contraction of funds by banks or NBFCs. Average property prices in Noida rose 6%.
GURGAON:
The residential absorption rate in Gurgaon rose 11% in 2011. This is largely due to a high launch activity in the market. Property prices in the market rose 17% during the year.
Unsold inventory in the market remains at healthy 9 months of average absorption. This means the demand for houses in Gurgaon is much higher than Mumbai.
BANGALORE:
The residential absorption rate in Bangalore grew 19% in 2011. This was primarily driven by large affordable (low cost) launches done by major buliders and developers. Price appreciation now seems to be catching up in Bangalore with completed or nearing completion projects witnessing 10 to 15% appreciation over the past few months.
New launches in Bangalore rose 56% in 2011. Average property prices rose up to 24% across key real estate pockets during the same period.
CHENNAI:
The residential absorption rate in Chennai rose 37% in the 2011. High launch activity has resulted in increased unsold inventory in the market. Unsold inventory rose to 15 from 10 months early last year. Average property prices rose 8% to 30 % in pockets from Anna Nagar to Rajeev Gandhi Salai (OMR)
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