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Residential PropertyMarket OverviewINDIAQUARTERLY UPDATE | FEBRUARY | 2013Accelerating success.
INDIA | FEB 2013 | residential    Research & forecast report    SYDNEY CENTRAL BUSINESS DISTRICT    research & forecast Re...
INDIA | FEB 2013 | residential                                                                                            ...
INDIA | FEB 2013 | residential                                                delhI                                       ...
INDIA | FEB 2013 | residential                                                                                            ...
India residential property market overview feb 2013
India residential property market overview feb 2013
India residential property market overview feb 2013
India residential property market overview feb 2013
India residential property market overview feb 2013
India residential property market overview feb 2013
India residential property market overview feb 2013
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India residential property market overview feb 2013

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The report gives an overall macroeconomic overview followed by latest real estate updates and trends in each city through rental and capital value trends, new projects as well as market prognosis for 2013 onwards. This quarter, the premium residential markets in India have shown an upward trend, with capital values increasing in the range of 5 to 10% QoQ. The Reserve Bank of India (RBI) reduced the repo and reverse repo rates by 25 basis points from 8.00% to 7.75% in Jan 2013 to induce immediate liquidity in the market. Following suit, a few banks such as SBI and HDFC marginally reduced their home loan rates by 5 to 10 basis points. The RBI also allowed Electronic Commercial Borrowing (EC B) for low cost affordable housing projects as a permissible end-use under the approval route. Now not only, developers and builders can avail EC B for low-cost affordable housing projects, but Housing Finance Companies (HFC s) and National Housing Board (NHB) can also avail of EC B for financing prospective owners of low-cost affordable housing units.

We anticipate that the mid-segment residential market will continue to remain active in markets like Bangalore, Pune, Chennai and NOIDA due to their favourable affordability quotient in the medium term. Meanwhile, markets like those in Mumbai, Delhi and Gurgaon will continue to fetch premium value in the luxury segment.

For more detailed information kindly click here to download the report. I am sure you will find the report an interesting and informative read.

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Transcript of "India residential property market overview feb 2013"

  1. 1. Residential PropertyMarket OverviewINDIAQUARTERLY UPDATE | FEBRUARY | 2013Accelerating success.
  2. 2. INDIA | FEB 2013 | residential Research & forecast report SYDNEY CENTRAL BUSINESS DISTRICT research & forecast Report India RESIDENTIAL market MACRO ECONOMIC OVERVIEW • GDP growth in the third quarter (July to September) of 2012 was 5.3%, contracted marginally from the previous quarter’s 5.5%. • The headline inflation based on the whole sale price index edged down to 6.95% for the month of January 2013, as compared to 7.18% in December 2012. • The Reserve Bank of India reduced the repo and reverse repo rates by 25 basis points from 8.00% to 7.75% in Jan 2013 to induce immediate liquidity in the market. Following suit, a few banks such as SBI and HDFC marginally reduced their home loan rates by 5 to 10 basis points. ECONOMIC BAROMETER • This quarter, the reserve bank of India allowed Electronic Commercial Borrowing (ECB) for low- cost affordable housing projects as a permissible end-use under the approval route. Now not Jan-12 Jan-13 only, developers and builders can avail ECB for low-cost affordable housing projects, but Housing Finance Companies (HFCs) and National Housing Board (NHB) can also avail of ECB for financing REPO RATE 8.50% 7.75% prospective owners of low-cost affordable housing units. REVERSE REPO RATE 7.50% 6.75% • The premium residential markets in India have shown an upward trend, with capital values CRR 5.50% 4.00% increasing in the range of 5 to 10% QoQ. Notwithstanding the current economic difficulties, the mid-segment residential market will continue to remain active in markets like Bangalore, Pune, INFLATION 6.89% 6.95% Chennai and NOIDA due to their favourable affordability quotient. Meanwhile, markets like those 1 in Mumbai, Delhi and Gurgaon will continue to fetch premium value in the luxury segment. Home Loan Rate 11.00% 10.00% Return on Alternative Investments Jan-12 Jan-13 YoY % ECONOMIC INDICATORS Change 12.0 Gold 27,428 30,714 11.98% 11.0 10.0 SILVER 51,500 58,443 13.48% 9.0 2 Fixed Deposit 9.25% 8.50% -8.11% 8.0 EQUITY 16,189 19,818 22.42% 7.0 In Percentage 6.0 3 REALTY INDEX 1,574 2,245 42.63% 5.0 4.0 3.01 SBI Home Loan Rate for Loan upto INR 30 Lakhs 2.02 SBI Fixed Deposit rate for a period of more than one year and amount 1.0 below INR 1 Crore3 Realty Index is a free float weighted index, comprised of real estate 0.0 development companies in the BSE-500 Index. Jun ‘08 Mar’ 08 May’08 Jul‘08 Sep’08 Nov ‘08 Jan ‘09 Mar ‘09 May‘09 Jul‘09 Sep ‘09 Nov‘09 Jan‘10 Mar‘10 May ‘10 Jul‘10 Sep‘10 Nov‘10 Jan ‘11 Mar ‘11 May‘11 Jul ‘11 Sep ‘11 Nov ‘11 Jan ‘12 Mar ‘12 May‘12 Jul ‘12 Sep ‘12 Nov ‘12 Jan ‘13 -1.0 Repo Rate Reverse Repo Rate Cash Reserve Ratio Wholesale Price Index Source: Goverment of India, Colliers International India Research www.colliers.com
  3. 3. INDIA | FEB 2013 | residential MUMBAI AVERAGE CAPITAL VALUE RANGE 80000 • n 4Q 2012, Mumbai’s residential market I witnessed an increase in launches of new 70000 premium residential projects in locations like 60000 INR per sq.ft. Wadala, Andheri and Chembur micro-markets 50000 priced in the range of INR 9,700 to 26,500 per 40000 sq ft. 30000 • Demand for residential properties from 20000 investors as well as end-users picked up 10000 this quarter due to the long festive season. Khar Malabar Hill, Altamount Road, Carmichael Road Breach Candy, Napeansea Road, Peddar Road Colaba, Cuffe Parade Worli Prabhadevi Bandra Santacruz Juhu Andheri Powai However, construction activities remained slow resulting in no major new supply during the surveyed quarter. MumBAI • Capital values for prime residential properties AVERAGE RENTAL VALUE increased modestly across the city in the Malabar Hill, AltamountCITY OFFICE BAROMETER Road, Carmichael Road Breach Candy, Napeansea range of 1-3% QoQ. However locations such 200 Road, Peddar Road Powai 4Q 2012 1Q 2013 as Worli, Khar, Santacruz, Andheri and Powai 150Capital Value remained stable due to the large supply. Andheri 100 Colaba, Cuffe Parade INR per sq.ft. per month 50Rental Value • Rental values of premium residential properties remained stable in almost all of the micro- 0New Project Worli markets, except Bandra and Khar, where a JuhuConstruction Pace marginal increase was noticed in rents. Santacruz PrabhadeviINVESTMENT OPPOURTUNITIES • The State Government of Maharashtra approved a new policy for Special Township Khar BandraMicro Market Ongoing Price (P.S.F) projects spread across 100 acres or more.Thane-Kalyan 4,000 - 8,000 The new policy mandates that such projects reserve 25% of the land for economic AVERAGE CAPITAL VALUE TRENDSNavi Mumbai 3,500 - 7,500 activities and 20% for Economically Weaker 75000 ForecastVirar- Boisar 3,000 - 6,000 Sections (EWS). Also it has increased the 60000Note: Ongoing Price (P.S.F): Indicative asking price for premium residential properties ready reckoner rates by 18-20% across theper sq.ft. city. 55000 45000 • Colliers View: The primary sales market INR Per sq.ft. in Mumbai picked up during the last quarter. 35000 A significant number of this demand came 25000 from end users due to attractive price points 15000 however, investors activity was overall limited due to longer exit periods. Secondary sales 5000 1Q2013F 3Q2013F 3Q2008 3Q2009 3Q2010 3Q2011 3Q2012 1Q2009 1Q2010 1Q2011 1Q2008 1Q2012 market remained curbed due to high price points. We anticipate, increased activity in primary sales market in the coming quarters Breach Candy, Khar Colaba, Andheri Napeansea Road, Cuffe Parade Peddar Road Prabhadevi Bandra Worli with numerous new launches in both luxury Powai Juhu Malabar Hill, Santacruz Altamount Road, Carmichael Road and mid housing segment in the 2/3 BHK Note: Average Capital/Rental Value Range: Indicative asking price for premium typology. residential properties on per sq.ft. basis. KEY NEW PROJECTS Project Name Location Developer Name Tentative Possession* Rate (Per Sq.ft.)** Elisium Wadala Lodha Group 4Q 2017 16,900 Elina Saki Naka Runwal Group 4Q 2014 9,750 Proxima Andheri Kurla Road The Dudhwala Group 4Q 2016 11,750 Serenity Chembur Godrej Properties 4Q 2015 26,400 Note: * As mentioned by developer ** Base selling price as quoted by developer Colliers International | p. 3
  4. 4. INDIA | FEB 2013 | residential delhI AVERAGE CAPITAL VALUE RANGE 115000 • During 4Q 2012, limited supply was added to the city’s premium residential inventory; only 100000 few small-scale redevelopment residential 85000 INR per sq.ft. projects were ready for possession in 70000 locations such as Vasant Vihar, Anand Niketan 55000 and Shanti Niketan. 40000 • In 4Q 2012, capital values for premium 25000 residential properties remained stable in all of 10000 Panchashila, Anandlok, Niti Bagh, SDA Chanakya Puri Friends Colony, Maharani Bagh Vasant Vihar Shanti Niketan, Westend Anand Niketan, Sunder Nagar Greater Kailash I & II, South Extension Golf Links, Jor Bagh, Prithviraj Road, Aurangzeb Road the micro-markets. Rental values for premium residential properties appreciated by 4% QoQ in the Prithviraj Road, Aurangzeb Road, Golf Links, Jor Bagh and Sunder Nagar micro- delhi markets. However, rents in micro-markets like AVERAGE RENTAL VALUE Anand Niketan, Vasant Vihar, Friends Colony, Prithviraj Road,CITY OFFICE BAROMETER Maharani Bagh, Panchashila, Anandlok, Niti Aurangzeb Road 200 Anand Niketan, 4Q 2012 1Q 2013 Bagh and SDA declined in the range of 2-4% Vasant Vihar 160 Chanakya Puri QoQ. 120Capital Value 80 INR per sq.ft. per month • The Urban Development Ministry has asked 40Rental Value Golf Links, Jor Bagh, Greater Kailash 0 the DDA (Delhi Development Authority) I & II, South Extension Sunder NagarNew Project to increase the FAR (Floor Area Ratio) forConstruction Pace the EWS projects from 200 to 400. This measure has been proposed with an aim to Shanti Niketan, reduce the affordable housing shortage in the Friends Colony, Westend Maharani Bagh capital; especially in the EWS segment. In this Panchashila, Anandlok, Niti Bagh, SDA quarter, the Delhi State Government has also revised the minimum circle rates in Category AVERAGE CAPITAL VALUE TRENDS A colonies by 200%, Category B by 50%, Categories C, D, and E by 25%, Categories F 100000 Forecast and G by 25% and Category H by 15%. The 90000 increase in the circle rate will help to increase 80000 transparency in the market by reducing the 70000 gap between the circle rate and the market 60000 INR Per sq.ft. value. 50000 40000 30000 • Colliers View: The new master plan 20000 for Delhi will facilitate the creation of new 10000 sub-cities within Delhi by unlocking around 0 60,000 hectares of land for development. The 1Q2009 3Q2012 1Q2011 3Q2008 1Q2010 3Q2010 1Q2012 3Q2011 1Q2013F 3Q2013F 3Q2009 1Q2008 increase in FAR (Floor Area Ratio) will help to Golf Links, Jor Bagh, Sunder Nagar Prithviraj Road, Aurangzeb Road boost residential real estate activity primarily Chanakya Puri Shanti Niketan, Westend in the EWS and LIG sections. Panchashila, Anandlok, Niti Bagh, SDA Friends Colony, Maharani Bagh Greater Kailash I & II, South Extension Anand Niketan, Vasant Vihar Note: Average Capital/Rental Value Range: Indicative asking price for premium residential properties on per sq.ft. basis. KEY ONGOING PROJECTS Project Name Location Developer Name Tentative Possession* Rate (Per Sq.ft.)** Capital Greens Shivaji Marg DLF Ltd. 2Q 2015 14,000 Castewood Okhla Indiabulls Ltd. 4Q 2013 12,800 Kings Court Greater Kailash - II DLF Ltd. 1Q 2015 36,000 Queens Court Greater Kailash- II DLF Ltd. 1Q 2015 36,000 Winter Hills Dwaraka Morh Umang Realtech 4Q 2013 8,750 Note: * As mentioned by developer ** Base selling price as quoted by developer p. 4 | Colliers International
  5. 5. INDIA | FEB 2013 | residential GURGAON AVERAGE CAPITAL VALUE RANGE 40000 • During 4Q 2012, a number of premium 35000 projects/ parts of projects were launched in Gurgaon. Most of these projects were 30000 INR per sq.ft. launched in the price rangeof INR 5,500 to 20000 10,000 per sqft in 3/4 BHK typology. Dwarka 15000 Expressway remained the most active 10000 market; other upcoming residential locations, like Sohna and Golf Course Extension Road, 5000 witnessed limited new launches. 0 Golf Course Road Sohna Road & Ext DLF Phase I Sushant Lok NH - 8 • Healthy demand was noticed during the surveyed quarter, and newly-launched projects witnessed high absorption despite an increased investment horizon. But most AVERAGE RENTAL VALUE Gurgaon of this demand was investor driven and theCITY OFFICE BAROMETER end-users kept themselves at bay due to Golf Course Road 80 limited options in mid-segment housing and 4Q 2012 1Q 2013 60 unaffordable prices. 40Capital Value INR per sq.ft. per month • Construction activities remain healthy, NH - 8 20 Sohna Road & ExtRental Value resulting in the completion of numerous 0New Project residential projects like “Tata Raisina” by Tata Group and “Palm Drive” by Emaar MGF,Construction Pace both on Golf Course Extension Road; and “La Lagoon” and “Verandas” by Salcon GroupINVESTMENT OPPOURTUNITIES both on Golf Course Road. Sushant Lok DLF Phase IMicro Market Ongoing Price (P.S.F) • Capital values in the secondary sales marketGolf Course 7,500 - 8,500 witnessed marginal appreciation in the range AVERAGE CAPITAL VALUE TRENDSExtension Road of 2 to 5% QoQ in locations like DLF Phase 18000Sohna Extension 5,000 - 6,500 I, Sushant Lok, NH8, etc. Eging locations Forecast 16000Pataudi Road 4,500 - 5,500 like Dwarka Expressway, New Gurgaon, 14000 Pataudi Road, Golf Course Extension Road,New Gurgaon 3,500 - 4,500 12000 etc. observed an increase in the range of 5 10000Note: Ongoing Price (P.S.F): Indicative asking price for premium residential properties to 10% QoQ. INR Per sq.ft.per sq.ft. 8000 • Colliers View: The Gurgaon residential 6000 market witnessed an increase in resale 4000 inventory stock. End-users activity remained 2000 restricted, this is primarily due to an increase 0 4Q2008 2Q2009 3Q2009 4Q2009 2Q2010 2Q2011 2Q2012 1Q2013F 2Q2013F 3Q2013F 4Q2013F 4Q2010 4Q2012 3Q2008 3Q2010 3Q2011 3Q2012 1Q2009 1Q2010 1Q2010 1Q2011 1Q2012 4Q2011 in prices and less options available for mid- segment housing. In the near term, micro- NH-8 Sohna Road & Ext markets such as Dwarka Expressway, Pataudi Golf Course Road Sushant Lok Road, Sohna Road and Golf Course Extension DLF Phase I Road will continue to witness interest from Note: investors; however, prices are expected to Average Capital/Rental Value Range: Indicative asking price for premium residential properties on per sq.ft. basis. remain more or less at the same levels. KEY NEW PROJECTS Project Name Location Developer Name Tentative Possession* Rate (Per Sq.ft.)** Imperial Garden Sector 102 Emaar MGF 4Q 2016 6,500 Kalistaa Sector 84 Spaze Towers 4Q 2015 7,080 Michael Schumacher World Tower Sector 109 Homestead 4Q 2016 12,000 - 14,000 Oyster Grande Sector 102 Adani Group 4Q 2016 5,500 Triumph Sector 104 ATS Group 4Q 2016 7,500 Woodshire Sector 107 M3M Group 4Q 2016 6,250 Note: * As mentioned by developer ** Base selling price as quoted by developer Colliers International | p. 5

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