Property Prices in Delhi NCR Grow Negligibly in Apr-Jun 2015 over Jan-Mar 2015: 99acres.com

Major Highlights

• Delhi NCR’s property market continued its snail-paced trajectory from Jan-Mar 2015 to Apr-Jun 2015 with an insignificant growth of 1 per cent in property prices.

• While frequent legal conflicts resulted in subdued buyer sentiment, a demand-supply mismatch gave developers a run for their money.

• Prices soared despite a huge inventory pile-up of 1.70 lakh units recorded till Apr- Jun 2015.

• The expansion of the Delhi metro improved sentiments in certain pockets of the market, impacting the rental values more than capital prices.

• As developers focused on offloading unsold inventory, there was a drop in the number of new launches in the region.

• The rental market performed better than the capital one due to more office space absorption, particularly in Noida and Gurgaon.

99acres.com Insite is a quarterly report focusing on capital and rental price trends in the residential real estate market across seven major cities of India. According to the report, property prices per sq ft in Delhi NCR witnessed negligible growth amounting one per cent in Apr-Jun 2015 as against Jan-Mar 2015. Rental values recorded an average increase of 5 per cent in the last one year (Apr-Jun 2015 vs. Apr-Jun 2014). An increase of 17 per cent was witnessed in the supply of residential apartments this quarter as against a dip of 16 per cent recorded in quarter ending March 2015. Units configured as 3BHKs continued to be the most supplied ones, followed by 2BHKs.

Commenting on the report, Mr Narasimha Jayakumar, Chief Business Officer, 99acres.com, said, “Though the market looks grim with snowballing unsold residential inventory, there is an increase in office space absorption by IT/ITeS and ecommerce firms. This is expected to keep the commercial and home rental markets of Noida and Gurgaon upbeat.”

Price Trend Analysis: Delhi (Apr-Jun 2015 vs. Jan-Mar 2015)

• Delhi witnessed a dip of 2 per cent in Apr-June 2015 as compared to the preceding quarter.

• Property prices in South Delhi grew insignificantly, while that in North and West Delhi dropped by 5 per cent and 8 per cent, respectively.

• Meanwhile, Dwarka’s price graph declined by 4 per cent and East Delhi saw a stagnant real estate market.

• Mehrauli was the top grosser, witnessing a 7 per cent rise in capital values in Apr-Jun 2015 as against the quarter ending March 2015.

• The upmarket neighbourhoods of Greater Kailash I and II clocked a surge of 6 per cent and 4 per cent, respectively, in the quarter ending June in comparison to the previous one.

Rental Analysis: Delhi (Apr-Jun 2015 vs. Apr-Jun 2014)

• The rental market of Delhi soared in response to the existing and developing infrastructure and increasing employment opportunities. Rental values in the region surged by an average of 5 per cent in the last one year.

• In this zone, East Delhi witnessed the highest growth of 10 per cent between Apr-Jun 2014 and 2015, while values in North Delhi stagnated during the same span. East Delhi was followed by Dwarka with a spike of 6 per cent in rental values. South and West Delhi clocked an increase of 5 and 4 per cent, respectively.

• A year-on-year analysis revealed that Jasola in South Delhi recorded over 20 per cent rise in rental values, the highest in the region. This locality has the advantage of a metro station (at a distance of less than two kilometre).

• Following Jasola closely was Dwarka Sectors 18 and 19, and Patparganj, each clocking a growth of 18 per cent each.

Price Trend Analysis: Noida and Greater Noida (Apr-Jun 2015 vs. Jan-Mar 2015)

• The plethora of proposed social and physical infrastructure propelled real estate sentiments in Greater Noida from stagnancy in the last quarter to a 2 per cent growth in Apr-Jun 2015. However, residential market in Noida maintained its slow growth pace with negligible price hike.

• The Noida-Greater Noida Expressway was the frontrunner with 9 per cent spike in real estate prices, with Sector-16 in Greater Noida and Noida Extension following closely with six per cent each.

• The Delhi Metro Rail Corporation (DMRC) has mentioned a tentative timeline of 3 years for the metro corridor between Noida and Greater Noida, boosting realty sentiments.

• The Supreme Court’s ruling on Greater Noida land acquisition has cleared the haze of uncertainty for almost 1.5 lakh property buyers. CREDAI has assured the delivery of around 50,000 residential units by the end of 2015.

Rental Analysis: Noida and Greater Noida (Apr-Jun 2015 vs. Apr-Jun 2014)

• Boasting of a massive 16 per cent spike in rental prices in the quarter ending June, Greater Noida realty landscape was impacted by the Noida-Greater Noida Metro corridor, the construction work on which commenced in the month of June. The metro link is slated to be operational in 2018.

• Rental values in Noida grew to the tune of 4 per cent between Apr-Jun 2014 and 2015. Improving connectivity, coupled with developing entertainment hubs are the prime growth drivers.

• Sector Omicron III in Greater Noida and Pari Chowk grabbed the top positions with a yearly rental hike of 17 and 14 per cent respectively, majorly owing to more project deliveries and improving connectivity from Delhi and Noida.

Price Trend Analysis: Ghaziabad (Apr-Jun 2015 vs. Jan-Mar 2015)

• Ghaziabad’s realty landscape saw an uptrend of 2 per cent in Apr- Jun 2015, in comparison to the preceding quarter due to promised infrastructural growth. The city’s real estate sentiments thrived on the announcement of Rs 1,500 crore for infrastructure development.

• The major infra plans include expansion of metro network from Dilshad Garden to New Bus Stand metro and construction of a Northern Peripheral Road spanning 21 km between Tila Mod in Delhi to Dasna Toll Plaza on NH-24. Development of a six-lane Hindon Elevated Road is also on the cards.

• National Highway 91 emerged as the highest grosser with 9 per cent spike in property prices since March 2015.

• Trans-Hindon localities including Indirapuram, Vaishali and Vasundhara fared among the top grossers in Apr-Jun 2015 compared to the previous quarter owing to connectivity to NH-24 and metro.

Rental Analysis: Ghaziabad (Apr-Jun 2015 vs. Apr-Jun 2014)

• An annual analysis revealed that rental values in Ghaziabad rose to the tune of 10 per cent in the quarter ending June, after a 5 per cent rise in Jan-Mar 2015.

• Vaishali saw the highest appreciation in the rental graph by 18 per cent from Apr-Jun 2014 to the same quarter this year. The proposal to expand the Vaishali metro link to Mohan Nagar has given a massive fillip to realty sentiments.

• The integrated project of Crossing Republik witnessed a hike of 17 per cent in rental values during the same span. In addition to metro connectivity being on the cards, the locality is comparatively more affordable than neighbouring Vaishali and Indirapuram, where rental demand rose by 8 per cent in the last one year.

Price Trend Analysis: Gurgaon, Faridabad, Bhiwadi and Dharuhera (Apr-Jun 2015 vs. Jan-Mar 2015)

• Gurgaon and Faridabad saw an uptrend in capital values, albeit an insignificant 1 per cent in Apr-Jun 2015. Homebuyers continued with their wait-and-watch approach, although both cities were frontrunners in the race for the ‘smart city’ tag.

• Construction of the metro network has given Faridabad a fresh lease of life. Despite being designed in accordance with the Nehruvian vision of a ‘City of Hope’, Faridabad has remained dependent on autos and buses till date. The metro will become the city’s first transit system.

• While Bhiwadi clocked an average rise in capital values to the tune of 3 per cent this quarter, property prices in Dharuhera dipped by 6 per cent. While proximity to Gurgaon is an advantage to both these satellite towns, availability of very few projects in Dharuhera, made demand and hence occupancy levels suffer.

Rental Analysis: Gurgaon, Faridabad, Bhiwadi and Dharuhera (Apr-Jun 2015 vs. Apr-Jun 2014)

• Rental demand remained robust in Gurgaon and Faridabad, with prices increasing by 4 per cent, each, in a year’s time.

• The highest grosser in Gurgaon was Sector 67 where values rose by 20 per cent in Apr-Jun 2015 as compared to the same quarter last year, followed by Sectors 69 and 59 where rentals increased by 17 per cent, each.

• Sector 86 in Faridabad witnessed rental values escalating by 14 per cent during the same span. Housing demand in this industrial township is being fuelled by expansion of the DMRC line.

• In addition to capital values, Alwar Bypass Road in Bhiwadi saw rental yields rising to the tune of 17 per cent. The rental market of the region is primarily propelled by the workforce in Gurgaon.

Supply Analysis (Apr-Jun 2015 vs. Jan-Mar 2015)

• Availability of Different Property Types: While residential apartments grabbed the maximum share of residential inventory in Noida, Greater Noida and Gurgaon; builder floors continued to be the most supplied units in Delhi and Ghaziabad.

• Availability of Property by Budget: Properties priced within Rs 40 lakh captured more than a quarter of the total inventory in Delhi NCR. This was followed by properties budgeted between Rs 60 lakh and 1 crore.

• BHK-wise Distribution of Property: The 3BHK category continued to be the most supplied one in Delhi NCR, with Gurgaon having the maximum supply of such units, followed by Noida and Ghaziabad.

• Ready to Move vs. Under-construction: More than 60 per cent of Delhi NCR’s inventory fell in the ready-to-move-in category. Almost three-fourth of the inventory in Noida, Greater Noida, Bhiwadi and Dharuhera continued to be under-construction due to long delays in project deliveries. The National Green Tribunal’s (NGT) ban on construction of houses within a radius of 10 km from the Okhla Bird Sanctuary delayed many projects in Noida and Greater Noida.

Link to report- http://www.99acres.com/articles/delhi-insite-report-apr-jun-2015.html

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Launched by Info Edge India Ltd. in September 2005, 99acres.com is a gateway to one of the fastest growing property markets of the world, an information 'exchange' for buying, renting and selling of all types of residential and commercial properties anywhere in India. The website enables easy access to a huge property bank and allows direct connect with brokers/builders in cities as well as remote parts of the country. With over 9 million visitors visiting the website every month looking for real estate solutions, 99acres.com has over 8.5 lakh residential and commercial property listings and over 1 lakh new projects. Not only this, it has the highest traffic share, making it the most popular real estate portal in the country. Backed by a strong team and a network across 40 cities in India, 99acres.com has garnered faith and support of the real estate community in India within a very short time span.