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Mid year 2015 Bangalore Residential Research Report

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Mid Year 2015 Bangalore Residential Research Report

LJ Hooker Research Report for 2015 also helps in understanding the residential real estate market from a macro to micro level keeping in sight the fundamental market scenario of the supply and demand.

2015, NOW ONLINE
By LJ Hooker
August 30, 2015
Bengaluru, India – LJ Hooker India has recently released Mid-Year Real Estate Market Research Report for 2015. This is the 6th issue released to the market and it tracks the Supply/Demand, and price of the primary residential market. This Research Report provides in-depth details of the primary residential market covering all Residential development-Apartment, Villa, Row House and Plotted developments which are offered for first sale.
LJ Hooker Research Report for 2015 also helps in understanding the residential real estate market from a macro to micro level keeping in sight the fundamental market scenario of the supply and demand.
The report includes a detailed study of:
1. Key Performance indicators such as Sales Velocity and Months Inventory
2. Trends on the capital value
3. Inventory Movement
4. Detailed market Dynamics such as Total Supply/ Unsold ( in units, size, value )
5. Region/Type/Budget wise supply and absorptions
6. Detailed analysis on the new launches on various parameters
7. A detailed study on the buyer preferences on investment decisions
8. Extended database of 1400 plus projects (Primary Residential developments across Bangalore)

for more info

www.ljhresearchindia.com

Published in: Real Estate
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Mid year 2015 Bangalore Residential Research Report

  1. 1. 2 | P a g e Dear Reader, Welcome to LJ Hooker India’s mid-year research report for 2015. This report is compiled to give the reader an understanding of the general residential market in Bangalore, particularly the Supply and Demand scenario on the residential market. This report contains an integrated research by the LJ Hooker India team, tracking sales from over 1,400 primary residential projects. The report covers all the significant projects located in various micro-markets across Bangalore, but we do not claim that this data analysis represents the entire market. The data has thrown light on the trends of the supply, demand and prices in the residential sector of the city over the last 6 months. Part One comprises of the general economic conditions and how they may affect the Bangalore Residential Real Estate market, Part Two of the report we have analysed data for the same. This report also covers a consumer buying behaviour backed by a survey sample size of 10,000 prospective buyers looking for residential developments in Bangalore forming Part Three of this report. Data from over 1,400 primary residential projects across Bangalore were tracked forming Part Four of this report. We hope you would find this report to be of your interest and would be happy to give us a feedback. Please feel free to contact LJ Hooker team should you wish for a detailed briefing. Kind Regards, Amit Porwal aporwal@ljh.in THIS REPORT CONTAINS FOUR SEPARATE AND DISTINCT SECTIONS FOR REVIEW: 1. Macro-economic review and predictions 2. Snapshot statistical report of the Bangalore residential market 3. An analysis on Buyer Preferences 4. Primary project by project source data 5. IMPORTANT NOTES -TO BE READ IN CONJUNCTION WITH THIS REPORT This report is compiled from primary data sourced by the in-house LJ Hooker research team from developers, prospective customers as well as general market information and previously published works (check footnotes). LJ Hooker do not make any claim as to the completeness or accuracy of this information or comments provided, and this information should not be used by third parties or relied upon when making financial decisions. The reader should at all times rely on their own independent research and information, and use this report as a guide only. LJ Hooker has taken due care in the collection of the data, however LJ Hooker does not warranty the correctness of the information provided in this presentation. The presentation is available only on an "as is” basis and without any warranties express or implied. LJ Hooker disclaims all warranties including any implied warranty of merchantability and fitness for any purpose. Without prejudice to the above, LJ Hooker will not be liable for any damages of any kind arising from the use of this presentation, including, but not limited to direct, indirect, incidental, punitive, special, consequential and/ or exemplary damages including but not limited to damages for loss or profit goodwill resulting from:  The incorrectness and/or inaccuracy of the information  Any action taken, proceeding initiated, transaction entered into on the basis of the information available in this presentation If you believe there are any omissions or inaccuracies in the report we would ask that you advise us at research@ljh.in as soon as possible.
  2. 2. 3 | P a g e TABLE OF CONTENTS 1 PART – I MACRO ECONOMIC REVIEW AND PREDICTIONS ......................................................................5 1.1 EXECUTIVE SUMMARY – MACRO MARKET CONDITIONS.......................................................................5 INTRODUCTION.................................................................................................................................5 GOVERNMENT POLICIES ...................................................................................................................5 INTEREST RATE..................................................................................................................................6 ONLINE BUYER BEHAVIOUR..............................................................................................................6 1.2 PREDICTION FOR THE RESIDENTIAL MARKET FOR THE SECOND HALF 2015 ..............................................7 GENERAL COMMENT ........................................................................................................................7 PREDICTION FOR THE SECOND HALF 2015 .......................................................................................7 1.3 GAP OF BUYER PREFERENCE AND DEVELOPER OFFERING.....................................................................8 2 PART – II STATISTICAL REPORT ON BANGALORE RESIDENTIAL MARKET ................................................9 2.1 EXECUTIVE SUMMARY ..........................................................................................................................9 CRUCIAL FIGURES..............................................................................................................................9 MORE FACTS .....................................................................................................................................9 REGIONAL SCENARIO ......................................................................................................................10 NEW LAUNCHES..............................................................................................................................10 BUYER PREFERENCES ......................................................................................................................10 2.2 BANGALORE PRIMARY RESIDENTIAL MARKET – MACRO ANALYSIS.....................................................11 KEY INDICATORS .............................................................................................................................11 KEY AVERAGES ................................................................................................................................12 DEVELOPMENT WISE PRICE TREND ................................................................................................12 DEVELOPMENT WISE PERFORMANCE INDICATORS........................................................................13 REGION WISE PRICE TREND ............................................................................................................14 REGION WISE PERFORMANCE INDICATORS....................................................................................14 INVENTORY MOVEMENT ................................................................................................................16 A COMPARISON ON THE INVENTORY MOVEMENT ........................................................................17 RESIDENTIAL MARKET DYNAMICS ..................................................................................................18 DETAILED PRICE CATEGORY MARKET DYNAMICS.......................................................................19 REGION WISE RESIDENTIAL MARKET DYNAMICS .......................................................................22 PROMINENT/EMERGING RESIDENTIAL CLUSTERS AROUND BANGALORE .................................24 PRICE MOVEMENT OF THE TOP 25 LOCATIONS – APARTMENT DEVELOPMENTS......................26 YEARLY LAUNCHES COMPARISON ..............................................................................................27 EXISTING VS NEW LAUNCHES.....................................................................................................29 3 PART – III ANALYSIS ON THE BUYER PREFERENCES ................................................................................31 3.1 RESIDENTIAL ENQUIRIES .....................................................................................................................31 3.2 BUDGET WISE BUYING PREFERENCE ...................................................................................................31 3.3 REGIONAL PREFERENCES.....................................................................................................................32 3.4 PREFERRED TYPE OF BHK - REGION WISE ............................................................................................33 3.5 TOP 25 PREFERRED LOCATIONS IN BANGALORE .................................................................................34 3.6 MOST FAVOURED PRODUCT REQUIREMENTS - LOCATION WISE........................................................34 3.7 MOST FAVOURED BUDGET CATEGORIES – REGION WISE ...................................................................35
  3. 3. 4 | P a g e 4 PART- IV PRIMARY PROJECT SOURCE DATA...........................................................................................37 4.1 RESIDENTIAL APARTMENT ..................................................................................................................37 BANGALORE CENTRAL ....................................................................................................................37 BANGALORE - NORTH EAST ............................................................................................................39 BANGALORE – NORTH WEST ..........................................................................................................55 BANGALORE - SOUTH EAST.............................................................................................................60 BANGALORE – SOUTH WEST...........................................................................................................76 4.2 PLOT ....................................................................................................................................................81 BANGALORE - NORTH EAST ............................................................................................................81 BANGALORE - NORTH WEST ...........................................................................................................83 BANGALORE - SOUTH EAST.............................................................................................................83 BANGALORE – SOUTH WEST...........................................................................................................87 4.3 ROW HOUSE........................................................................................................................................87 BANGALORE – CENTRAL..................................................................................................................87 BANGALORE – NORTH EAST............................................................................................................87 BANGALORE – NORTH WEST ..........................................................................................................88 BANGALORE – SOUTH EAST............................................................................................................88 BANGALORE – SOUTH WEST...........................................................................................................89 4.4 VILLA....................................................................................................................................................89 BANGALORE CENTRAL ....................................................................................................................89 BANGALORE – NORTH EAST............................................................................................................89 BANGALORE - NORTH WEST ...........................................................................................................90 BANGALORE – SOUTH EAST............................................................................................................91 BANGALORE – SOUTH WEST...........................................................................................................94
  4. 4. 5 | P a g e 1 PART – I MACRO ECONOMIC REVIEW AND PREDICTIONS 1.1 EXECUTIVE SUMMARY – MACRO MARKET CONDITIONS INTRODUCTION A real estate market performance is directly proportional to a country’s economic performance. In India, last few years have been quite agonizing for the real estate sector. The star reason for this havoc is the decline in sales and mounting debts which are the growth drivers for an economy. This is especially true for the residential property segment. For more prosperity, higher financial confidence among home buyers will lead to a greater demand for homes. GOVERNMENT POLICIES In 2014 there was a boost in investors’ confidence coupled with renewed interest from key stakeholders. It started when a stable government came to power at the Centre with a thumping majority. Henceforth, the government has unleashed a lot of reforms in the last few months to give a fresh motivation to the real estate sector.  The notification by the Securities and Exchange Board of India (SEBI) on the Real Estate Investment Trusts (REITs) regulations paved the way for introduction of an internationally acclaimed investment structure in India.  One of the key requirements for feasibility of REITs was the tax pass status provided to the REITs through necessary amendments to the Indian tax regime.  Real Estate (Regulation & Development) Bill that was introduced in the Rajya Sabha last year, is still being debated at various levels. Government recently introduced three revisions to the bill to iron out the differences between various stakeholders. These recommendations have been made by the ministry and now await the clearance from the Prime Minister’s Office.  The government also amended the rules for Foreign Direct Investment (FDI) in the construction sector by reducing minimum built-up area as well as the capital requirement, while also easing the exit norms. Expected several positive regulatory changes, the sector is poised for a fast growth in 2015. However, the real estate sector as a whole will have to focus on faster implementation of projects and on-time deliveries. Developers will have to also improve the quality of construction to cope with the growing expectations of customers and investors. Finality on the Real Estate (Regulation & Development) Bill will be a single window clearance system for reforms that will surely be a positive turn for the real estate sector in 2015.
  5. 5. 6 | P a g e INTEREST RATE An expected move was made by the Governor of Reserve Bank, Raghuram Rajan in June 2015. The second rate cut of 25 basis points was witnessed during the second bi-monthly policy review of 2015. With Consumer Price Inflation(CPI) inched down to a 4 month low at 4.87%, the repo rate now stands at 7.25%. CPI has increased to 5.4% in June 2015. It’s the highest figure mapped since October last year. Considering the high CPI, RBI maintains status quo in the third bi-monthly policy of this fiscal (repo rate @ 7.25%). Another rate cut could be witnessed in next policy in September depending on the macro-economic data and how monsoon pans out. A substantial reduction in inflation provides the RBI the comfort to cut repo rate. A cut in repo rate will provide the much needed stimulus to the economy. ONLINE BUYER BEHAVIOUR Online property scouting and comparison is highly prevalent in India today. Given varied choices, buyers seek for a background check online, which in-turn demands for an updated information online from the builders. Buyers are now accustomed to looking closely at a property before making the purchase decision. This led to the developments of 3D floor plans, video walkthroughs, 360 degree panorama, aerial shots, map based searches, price heat maps, price trends and many more to make it a detailed, informative experience. As per Google survey, buyers contributing to 89% of real estate business by value are online today, and over 57% buyers are influenced by internet in the decision making process. From the E-commerce firms, latest concepts such as the flash sale have been introduced in the real estate sector. The first of this event was Indian Realty Flash Sale (IRFS) that took place in June this year saw a total of 6.25 lakhs visitors during the sale period. In no time, newer concepts such as the flash sale will move the entire home buying process from research, comparison, short listings, site visits and even booking to the developers’ online platform.
  6. 6. 7 | P a g e 1.2 PREDICTION FOR THE RESIDENTIAL MARKET FOR THE SECOND HALF 2015 GENERAL COMMENT LJ Hooker predictions made in our previous report – Snapshot Q1 2015, of drop in number for new launches has come true, the expectation on price correction hasn’t seen the light of day. Builders have not given steep discounts for the last 6 month to beat the sluggish demand. This has hit the market absorption adversely. As a result of which, the absorption rate recorded an all-time low at 1.6% during the first half 2015. Despite the fact that absorption rates are declining and inventories are piling up in the residential market, the Capital Value has witnessed an 8% increase in its rate compared to the end of 2014. LJ Hooker anticipation on increase in price:  Increasing input cost such as material cost, capital cost and land cost.  New launched projects are priced higher than the existing inventories, which resulted in less competition and push in the average Capital Value to the higher side simultaneously.  Majority new launches were witnessed in the mid-range and premium category segment of size 19 Mn sq. ft. priced at an average of INR 5,961 per sq. ft. with an average size of 2,026 sq. ft., inferring the cost is on the higher side.  Residential market witnessed the lowest number of new launches in the past 4 years. PREDICTION FOR THE SECOND HALF 2015 LJ Hooker opinionates that the residential market will see a time correction rather than the immediate price correction, since the prices are not declining in sync with decrease in demand. This will create more unoccupied inventories and delay in the project deliveries. Due to the availability of multiple options from the unsold project inventories and prospective buyers keeps bargain for the best possible deal.
  7. 7. 8 | P a g e 1.3 GAP OF BUYER PREFERENCE AND DEVELOPER OFFERING In this issue we have analyzed the gap between what developers are offering and what buyers are looking for. To understand the gap between them we have come up with a comprehensive analysis that is discussed in later part of this report. This analysis is furnished based on the enquiries received from prospective buyers and the major findings are given below. What buyers are looking for? What developers are offering?  70% of buyers prefer apartment development, followed by plotted development with an interest of 16%.  85% of development on offer is apartment development, whereas plotted development is at 13%.  Preferred budget categories for the apartments are INR 30-50 lakhs (33%) followed by INR 50-70 lakhs (27%) and INR 70 lakhs-1 crore (22%).  The inventory level for apartment lies in INR 30-60 lakhs (34%), INR 60 lakhs – 1 crore (33%) and the rest 33% belongs to more than INR 1 crore bracket.  Most preferred ticket size for villa development is INR 70 lakhs-1 crore.  Villa inventory in INR 70 lakhs -1 crore is just 20%. INR 1-3 crores category with maximum inventory followed by INR 3-8 crores (25%). As illustrated above, one third of the available inventories from the developers are priced above 1 crore, which is beyond the limit of buyer preference. To make the market more efficient, the developers have to promote more budget and mid-range categories. It is observed that the most preferred type of homes amongst customers are the 2 BHK followed by 3 BHK homes. There is a huge gap in the buyer’s budget preferences and the developer’s offerings on the villa development. The maximum enquiries are received for INR 70 lakhs-1 crore, while the developer’s inventory in this category is just 20% and the remaining comes above INR 1 crore categories.
  8. 8. 9 | P a g e 2 PART – II STATISTICAL REPORT ON BANGALORE RESIDENTIAL MARKET 2.1 EXECUTIVE SUMMARY CRUCIAL FIGURES  The real estate market of Bangalore witnessed a dip in its absorption trend and reached to an all-time low Sales Velocity by 1.6%.  The average Capital Value has increased to INR 5,261/- per sq. ft. from INR 4,866/- per sq. ft. which is an 8% increase.  An increase of 33% has been seen in Months unsold inventory when compared to the second half of 2014. Now market has 21.8 months of inventory to offload compared to second half 2014 which was at 16.4 months.  The value of total unsold inventory of Residential Development amounts to INR 87,501 crores. Which is 4% increase from the second half of 2014 (INR 84,272 crores).  Considering the oversupply and sluggish demand, the Months Inventory of Apartment stands at 21.7 months. MORE FACTS  Apartment development being the dominator in the Residential development of Real Estate market stands at an unsold size of 131.7 Mn sq. ft. (85,722 units)  The Apartment development has witnessed a 15% hike in its cost per unit pricing, whereas the Row House and Villa development has increased by 16% and 6% respectively.  The average price per sq. ft. for Apartment, Plot, Row house and Villa type of development has appreciated by 9%, 17%, 8.8% and 1.3% respectively in the first half of 2015.  Plots have the highest Sales Velocity of 2.3% which sells faster than any other Residential development type.  A total of 29,135 units were added to the closing stock in the first half of 2015. From the total additions, North-East quadrant had contributed with maximum share of 13,535 units in new addition.  Budget Homes had a large chunk of 13,009 units being added to the already available stock of 40,056 units.  Average price of an Apartment in Budget Home category is INR 46.6 lakhs and the average size on offer is 1,253 sq. ft.
  9. 9. 10 | P a g e REGIONAL SCENARIO  North-West region has witnessed the highest appreciation of 10.6% and stands at an average price of INR 5,344 per sq. ft.  South-East region appears to have the highest Sales Velocity of 1.8% and sells faster than the other locations.  Central Bangalore has the highest Months Inventory of 37.3 months and the lowest Sales Velocity of 1.09%.  North-East region has the maximum amount of unsold units costing INR 32,813 crores following with South-East region with unsold inventory of 61.2 Mn sq. ft. amounting to INR 27,027 crores.  South-East region has the highest supply of Apartment units, measuring 129.7 Mn sq. ft. and 93,203 units in total. NEW LAUNCHES  The market has witnessed lesser number of launches in Apartment segment this period when compared to the second half of 2014. There is -37.2% dip in the size of new launches in the first half of 2015 compared to the second half of 2014.  Launches in Row houses remains at the same figure of 0.4 Mn sq. ft. from 2014 till first half 2015. Villa development has drastically reduced in the size of launches from 2.1 Mn sq. ft. in 2014 to 1.3 Mn sq. ft. in the first half of 2015.  Prices of new launches in 2015 have increased, however the same doesn’t hold good for Row house development. Plots and Villas have appreciated by 13.1% and 34.9% respectively. The steep appreciation of average price in villas is due to larger number of launches in the ultra luxury segment, whereas, Row houses launched in first half of 2015 have depreciated by -26.4%.  The average size as well as the average price per sq. ft. for new additions in first half of 2015 has increased. An increase of 6% was observed from INR 5,226 to of INR 5,540 per sq. ft. in first half of 2015.  Majority of new launches are noticed in the Mid-Range and Premium Homes segment combined.  The North-East region contributes 44% to the total supply of new launches whereas South-East region adds a supply of 33%. BUYER PREFERENCES  Bangalore South has the maximum enquiries in apartments with 36%  Bangalore South region has the highest enquiries for a 2 BHK homes and falls under the home category of INR 50-70 lakhs which is also the most preferred category.  Bangalore North has enquiries amounting to 28%  Bangalore East amounts to 19%.
  10. 10. 11 | P a g e 2.2 BANGALORE PRIMARY RESIDENTIAL MARKET – MACRO ANALYSIS The real estate market of Bangalore witnessed a dip in its absorption trend and reached an all-time low Sales velocity of 1.6%. The average Capital Value has increased to INR 5,261/- per sq. ft. from INR 4,866/- per sq. ft. with an 8% increase. KEY INDICATORS *Plots are not considered while tabulating Months Inventory is at its highest in the first half of 2015 when compared to the periods following December 2012. An increase of 33% is noticed in Jan 2015 Months Inventory when compared to the second half of 2014. The ever increasing Months Inventory is attributed to the low Sales Velocity of 1.6%. Bangalore is experiencing all the extremes such as, highest Months Inventory, Lowest Sales Velocity and Highest Average price per sq. ft. in the first half of 2015. Year Sales Velocity Months Inventory Average Price Per sq. ft. Dec-12 3% 12 4,702 Jul-13 4.2% (45.9%) 9(-26%) 4,753(1%) Jan-14 2.2% (-49.1%) 16(85%) 4,936(4%) Jul-14 2.3% (5.2%) 15(-6%) 5,030(2%) Jan-15 2.2% (-3%) 16(9%) 4,866(-3%) Jul-15 1.6% (-27.3%) 22(33%) 5,261(8%) 4,702 4,753 4,936 5,030 4,866 5,261 0% 1% 2% 3% 4% 5% 6% 0 5 10 15 20 25 Dec-12 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Months Inventory Sales Velocity Average Price Psf
  11. 11. 12 | P a g e KEY AVERAGES Type Average Ticket Size in lakhs (INR) Average Size Jan14 Jul-14 Jan-15 Jul-15 Jan-14 Jul-14 Jan-15 Jul-15 Apartment 99 86 (-13%) 90 (4%) 103 (15%) 1,655 1,636 (-1%) 1,609 (-2%) 1,655 (3%) Row House 183 174 (-5%) 183 (5%) 212 (16%) 2,932 2,949 (1%) 2,971 (1%) 3,067 (3%) Villa 255 222 (-13%) 213 (-4%) 226 (6%) 3,522 3,453 (-2%) 3,266 (-5%) 3,230 (-1%) Considering the increased average price per sq. ft., the ticket size of all Residential developments have increased in first half of 2015. The Apartment development has witnessed a 15% hike in its cost per unit pricing, whereas the Row House and Villa development has increased by 16% and 6% respectively. It has also been observed that the average size of the Residential developments has increased. The increase in size is marginal in nature, where the Apartment and Row House sizes face a mere 3% increase, the Villa development faces 1% reduction in size from second half of 2014. DEVELOPMENT WISE PRICE TREND Price Trend Apartment Plot Row House Villa Dec-12 4,432 1,307 5,200 5,652 Jul-13 4,549 (2.6%) 1,290 (-1.3%) 5,595 (7.6%) 6,036 (6.8%) Jan-14 4,695 (3.2%) 1,461 (13.2%) 5,856 (4.7%) 6,681 (10.7%) Jul-14 4,821 (2.7%) 1,682 (15.2%) 6,096 (4.1%) 6,508 (-2.6%) Jan-15 4,677 (-3%) 1,659 (-1.3%) 6,018 (-1.3%) 6,329 (-2.8%) Jul-15 5,099 (9%) 1,951 (17.6%) 6,551 (8.8%) 6,409 (1.3%) In January 2015, a dip in the prices of all Residential developments was observed. First half of 2015 has seen appreciation in all the development types. Plotted development has appreciated the most when compared to other development types with 17.6%. Apartment, Row house and Villa type of development has appreciated by 9%, 8.8% and 1.3% respectively. 4,432 4,549 4,695 4,821 4,677 5,099 1,307 1,290 1,461 1,682 1,659 1,951 5,200 5,595 5,856 6,096 6,018 6,551 5,652 6,036 6,681 6,508 6,329 6,409 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 5,500 6,000 6,500 7,000 Dec-12 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Apartment Plot Row House Villa
  12. 12. 13 | P a g e DEVELOPMENT WISE PERFORMANCE INDICATORS 2.2.4.1 DEVELOPMENT WISE SALES VELOCITY Sales Velocity Apartment Plot Row House Villa Dec-12 2.79% 5.69% 3.07% 4.02% Jul-13 4.26% 5.31% 5.35% 3.65% Jan-14 2.16% 1.27% 2.41% 2.01% Jul-14 2.29% 1.37% 2.97% 1.67% Jan-15 2.22% 2.16% 1.20% 1.83% Jul-15 1.60% 2.30% 1.48% 1.54% Plots have the highest Sales Velocity of 2.3% which sells faster than any other Residential development type. Apartment development is contributing the maximum number of units to the residential market, and has a low Sales Velocity of 1.6%. The Sales Velocity has reduced from 2.2% in second half of 2014 to 1.6% in first half of 2015 due to decrease in demand, caused by increase in supply and price. Villa development and Row house development has a Sales Velocity of 1.54% and 1.48% respectively. Amongst all, Row house development Sales Velocity has increased due to limited supply. 2.2.4.2 DEVELOPMENT WISE MONTHS INVENTORY Months Inventory Apartment Plot Row House Villa Dec-12 11.6 4.1 16.1 12.3 Jul-13 8.3 3.7 7.0 12.5 Jan-14 15.7 14.0 12.2 20.3 Jul-14 14.7 14.7 9.4 22.5 Jan-15 16.2 11.4 25.6 19.8 Jul-15 21.7 11.5 20.5 22.6 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% Jan-14 Jul-14 Jan-15 Jul-15 Sales Velocity Apartment Plot Row House Villa 0 5 10 15 20 25 30 Jan-14 Jul-14 Jan-15 Jul-15 Months Inventory Apartment Plot Row House Villa
  13. 13. 14 | P a g e Due to the highest Sales Velocity, the Months Inventory of plots is low at 11.5 months. Considering the increase in supply and price, and lower demands, the Months Inventory of Apartment stands at 21.7 months. Villa development priced at premium range has the highest Months Inventory of 22.6 months amongst other developments. Row house is just a little lower than Apartment development at 20.5 months of inventory. REGION WISE PRICE TREND Price Trend Central North East North West South East South West Dec-12 14,600 4,560 3,949 3,365 3,652 Jul-13 15,383 (5.4%) 4,636 (1.7%) 4,422 (12%) 3,913 (16.3%) 4,055 (11%) Jan-14 15,914 (3.5%) 4,888 (5.4%) 4,778 (8%) 4,161 (6.3%) 4,228 (4.3%) Jul-14 14,013 (-11.9%) 4,886 (0%) 5,168 (8.2%) 4,221 (1.4%) 4,408 (4.3%) Jan-15 12,438 (-11.2%) 4,694 (-3.9%) 4,831 (-6.5%) 4,123 (-2.3%) 4,305 (-2.4%) Jul-15 13,466 (8.3%) 5,100 (8.7%) 5,344 (10.6%) 4,409 (6.9%) 4,651 (8%) *Plots are not considered while tabulating The North-West region has witnessed the highest appreciation of 10.6% and stands at an average price of INR 5,344 per sq. ft. The Central, North- East and the South-West regions have appreciated on similar lines of 8% and above to a limit of 8.7%. South-East region has appreciated the least when compared to other regions of Bangalore. With an appreciation level of 6.9% it stands at an average price of INR 4,409/-per sq. ft.; average price per sq. ft. costs INR 13,466 in Central Bangalore. REGION WISE PERFORMANCE INDICATORS 2.2.6.1 REGION WISE SALES VELOCITY Year Central North East North West South East South West Jul-13 1.73% 4.29% 5.18% 3.85% 4.24% Jan-14 1.45% 2.12% 1.75% 2.13% 2.81% Jul-14 3.62% 2.28% 1.51% 2.23% 2.74% Jan-15 1.91% 2.56% 1.94% 2.02% 2.10% Jul-15 1.09% 1.51% 1.24% 1.80% 1.60% South-East region appears to have the highest Sales Velocity of 1.8% and sells faster than the other locations. Following the South-East region is the South-West, North-East, North-West and Central region with Sales Velocity of 1.6%, 1.5%, 1.2% and 1.09% respectively. The Sales Velocity in first half of 2015 has dropped compared to second half of 2014. In conclusion, all the regions have faced a dip in Sales Velocity.
  14. 14. 15 | P a g e 2.2.6.2 REGION WISE MONTHS INVENTORY Year Central North East North West South East South West Jul-13 14.1 8.8 7.1 9.1 10.4 Jan-14 16.5 15.6 18.2 17.5 12.7 Jul-14 9.3 15.3 24.6 15.0 14.1 Jan-15 23.1 14.0 17.7 17.0 19.9 Jul-15 37.3 24.6 25.1 17.3 25.8 As a result of high Sales Velocity in the South-East, this region has the lowest Months Inventory level of 17.3 months. Apart from Central Bangalore, the other three quadrants of Bangalore have the Months Inventory ranging between 24.6 to 25.8 months. Central Bangalore has the highest Months Inventory of 37.3 months and low Sales Velocity of 1.09%. 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% Jan-14 Jul-14 Jan-15 Jul-15 Region Wise Sales Velocity Central North East North West South East South West 0 5 10 15 20 25 30 35 40 Jan-14 Jul-14 Jan-15 Jul-15 Region Wise Months Inventory Central North East North West South East South West
  15. 15. ANNEXURE REGIONS AND ITS LOCATIONS DETAILS Regions Locations Central Andree Road, Benson Town, Binnipete, Brigade Road, BTM Layout, Cunningham Road, Domlur, Frazer Town, Hennur Road, HSR Layout, Indiranagar, Jayanagar, Koramangala, Lalbagh, Lalbaugh, Lavelle road, Magadi Road, Mekri Circle, MG road, Palace Road, Rajajinagar, Richards Park, Richmond Road, Sadashiva Nagar, Sankey Road, Shivaji Nagar, Vittal Mallya Road, Wheeler Road. North East Avalahalli, Bagalur, Banaswadi, Chikkaballapur, CV Raman Nagar, Devanahalli, Hebbal, Hennur Road, Horamavu, Hoskote, ITPL , Jakkur, Jeevan Bhima Nagar, Kaggadaspura, Kammanahalli, KR Puram, Mahadhevapura, Marathahalli, Nandi Hills, Old Airport Road, Old Madras Road, Outer Ring Road, Ramamurthi Nagar, RMV Extension, RT Nagar, Thanisandra Main Road, Vidhyanagar Cross, Whitefield. North West Doddaballapur Road, IVC Road, Jalahalli, Kannahalli, Kodigehalli, Magadi Road, Malleshwaram, Mathikere, Nagarbhavi, Nelamangala, Rajajinagar, Rajankunte, RMV Extension, Sahakar Nagar, Tumkur Road, Vidyaranyapura, Yelahanka, Yeshwanthpur. South East Anekal, Attibelle, Bagalur, Bannerghatta Road, Begur Road, Bellandur , Bommasandra, BTM Layout, Chandapura, Chandapura - Anekal Road, Electronic City, Gottigere, Gunjur, Haralur Road, Hosa Road, Hosur, Hosur Road, HSR Layout, Jigani, Jigani -Anekal Road, Kasavanahalli, Marathahalli, Marsur, Outer Ring Road, Panathur, Sarjapur, Sarjapur Road, Varthur. South West Banashankari, Bidadi, Jigani, JP Nagar, Kanakapura Road, Kengeri, Kumbalgudu, Mysore Road, Peenya, Rajarajeshwari Nagar, Sulikere, Uttarahalli. * Regional categorisations for the report, except part III PRICE CATEGORY AND ITS TICKET SIZES Price Category Ticket Size Value Homes 0 - 30 Lakhs Budget Homes 30 Lakhs - 60 Lakhs Mid - Range 60 Lakhs - 1 Crore Premium 1 Crore - 3 Crores Luxury 3 Crores - 8 Crores Ultra Luxury 8 Crores - 20 Crores GLOSSARY Inventory: It is the unsold stock between two dates of survey. It covers all new launches (new additions) as well as carried-forward inventory from the previous survey: Previous Unsold + New Additions. Sales Velocity: This signifies demand – supply scenario in a market. It is the ratio between monthly sales and total supply and gives an idea of gestation period of a project as per the existing dynamics. Ideally SV shall be between 2.75% and 3%. The pace translates into gestation period of a maximum of 36 months of a project. Months Inventory: This represents the number of months required for the inventory in the market to be absorbed according to the existing demand. It is calculated by dividing the closing stock (marketable stock) by monthly sales.
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