Residential Property Research and Forecast Report - April 2016

www.colliers.com/india
Residential Property Research
and Forecast Report
April 2016

Going forward, steady enquiries, mainly in the affordable and
mid-segment is likely to bring back fence sitters. Capital and
rental values are expected to be rationalized in the near term as
residential markets across all major cities witness developers’
focus on clearing unsold inventory. Falling interest rates
coupled with the introduction of Real Estate (Regulation and
Development) Act, 2016 are expected to stimulate end user
demand and lead to market recovery.
INDICATORS Q4 2015 Q1 2016
QoQ %
CHANGE
Gold 25,014 29,080 16.25%
Silver 32,984 36,651 11.12%
Fixed Deposit² 7.75% 7.50% -3.23%
Equity – BSE 26,117 25,341 -2.97%
S&P BSE Realty Index³ 1,344 1,228 -8.63%
Return on Alternative Investments
Research &
Forecast Report
INDIA | RESIDENTIAL
April 2016
¹SBI home loan rate for loan up to INR 30 lakhs
²SBI fixed deposit rate for a period of more than one year & amount below INR 1 crore
³S& P BSE Realty index is a free float weighted index, comprised of real estate
development companies in BSE – 500 Index
*Mumbai, Pune, Bengaluru, Chennai, Gurgaon and Noida
Source: Government of India, Colliers International India Research
Moderate influx of
new launches in
major cities
In the first quarter of 2016, the top six* cities witnessed the
infusion of nearly 19,000 new residential units. Of the total,
maximum launches were concentrated in Mumbai (34%),
Bengaluru (32%) and Pune (12%). Whilst developers across all
major cities steered clear of inundating the primary residential
segment with too many new products, recovering market
confidence prompted them to lure buyers with cash discounts
and freebies. As per Reserve Bank of India (RBI)’s new
directive, interest rates will have to be reviewed every month on
the basis of MCLR (marginal cost of lending rate) which is
expected to bode well for the buyers seeking home loans.
Source: Government of India, MOSPI, RBI Colliers International India
Research
INDICATORS Q4 2015 Q1 2016
Repo Rate 6.75% 6.75%
Cash Reserve Ratio 4.00% 4.00%
CPI Based Inflation 5.61% 4.83%
Home Loan Rate¹ 9.70% - 10.00% 9.30% - 9.60%
Economic Barometers
Economic Indicators
Source: Government of India, Colliers International India Research
Colliers View

The first quarter of 2016 witnessed an increased traction
in the primary residential sales market specially in the
projects where developers were offering flexi payment
plans and competitive pricing. About 6,500 new
residential units were launched in this quarter.
Interestingly, a number of projects were launched in
Central and Western suburb locations such as Chembur,
Byculla, BKC, Goregaon, Malad in Q1 2016. Most of
these projects were launched in the price range of INR
15,000 per sq ft to 25,000 per sq ft. Beside this, a few mid
segment projects in the price range of INR 7,500 to
8,000 per sq ft were also launched in Thane.
Secondary residential market maintained a status quo
and not many transactions were concluded during the
quarter.
Whilst, a marginal appreciation of 1 to 2% in capital
values was witnessed in select locations such as Santa
Cruz, Powai, Khar and Bandra, capital values in almost
all other micro markets remained stable. Rental values in
the luxury segment remained stable. However, micro
Residential sector
witnessed improved
sentiments in Q1
2016
About 6,500 new residential units
launched in Q1 2016
Market Indicators
Relative to prior period 2015 2015 2016 2016F
CapitalRate
New Projects
Construction
Rental Rate
MICRO MARKETS
CAPITAL VALUES
(INR PSF)
% CHANGE
QoQ YoY
South Mumbai 48,000-69,000 0% 3%
Worli 48,000-58,000 0% 3%
Prabhadevi 46,000-55,000 -1% -2%
Bandra 34,000-47,000 1% 1%
Khar 27,000-34,000 2% 2%
Juhu 27,000-31,000 0% 4%
Santa Cruz 24,500-28,500 2% 4%
Powai 21,000-27,000 2% 12%
Andheri 19,000-23,000 0% 5%
Market Trends
Note: Above values represents indicative asking price for premium properties
Only secondary market products capital values mentioned
*Represents base selling price
Research &
Forecast Report
MUMBAI | RESIDENTIAL
April 2016
Source: Colliers International India Research
Market Q3 Market Q4 Market Q1 Market Q2

markets such as Powai and Worli witnessed an
increased demand from expatriates for serviced
apartments.
This quarter, the state government has finally
implemented the increased ready reckoner rates w.e.f
from 1st April 2016 which was postponed in Dec 2015.
The rates were increased moderately to the tune of 7%
on average keeping in view that the residential market is
reeling under pressure due to high price points and
increase in ready reckoner rates may further impact the
sentiments adversely. The ready reckoner rates were
earlier increased by 27% in 2013 followed by another
hike of 22% in 2014.
Beside this at the policy level, Municipal Corporation of
Greater Mumbai (MCGM) revised the draft development
plan which recommended hike in the floor space index
(FSI) from the present 1.33 to 2 and in some cases even
up to 5. If implemented, this may help addressing
unaffordability issue by creation of more housing.
Colliers View
Q1 2016 witnessed an increased traction in the primary
market and we expect the momentum to continue in the
coming quarters. However, huge available inventory
and new upcoming supply is undermining the short term
appreciation in capital values both in primary and
secondary market. Rents are expected to remain stable
across the market. Mid-segment projects will continue to
remain the most preferred assets class and, location
and price points will remain the predominant factors
driving the demand.
Average Capital Value Trends
Average Rental Values
FOR RESIDENTIAL SERVICES AUTHORS
Sumit Jain
National Director
Residential Services
sumit.jain@colliers.com
Arvind Kapoor
Director
Residential Services| India
arvind.kapoor@colliers.com
Surabhi Arora
Senior Associate Director
Research Services
surabhi.arora@colliers.com
Amit Oberoi
National Director
Valuation & Advisory
Services and Research
amit.oberoi@colliers.com
Colliers International (India)
Property Services Pvt. Ltd.
Indiabulls Finance Centre, 17th
Floor, Unit No. 1701, Tower 3
Senapati Bapat Marg,
Elphinstone (W)
TEL +91 22 4050 4500
Copyright © 2016 Colliers International.
The information contained herein has been obtained from sources deemed
reliable. While every reasonable effort has been made to ensure its accuracy, we
cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are
encouraged to consult their professional advisors prior to acting on any of the
material contained in this report.

Gurgaon’s residential market continued to maintain status
quo in terms of demand. Sales in the primary market
remained weak from the last six consecutive quarters. The
tepid response for the soft launch projects resulted in
minimal new project launch in the market in Q1 2016. The
new project that came or sale in the market includes high
end project ‘La Vida’ in sector 113 by Tata Housing at a
basic selling price of INR 8,500 per sq ft and mid segment
projects like Bestech Park View Altura in sector 79 by The
Bestech ParkView Altura Company; The Turning Point in
sector 88B by Vatika at base selling price of 5,130 per sq ft.
In the secondary market, the demand was primarily driven
by end users. The number of enquiries have increased for
ready to move in properties in micro markets such as Golf
Course Extension Road and Sohna Road, however, it has
not translated in increase in transaction volumes from the
previous quarter. Dwarka Expressway and New Gurgaon
sectors continued to receive lukewarm response from end
users even for the completed projects due to lack of social
amenities and connectivity.
Capital values remained stagnant in almost all the micro
markets, however, project specific discounts were available
Residential market
maintained status
quo
Minimal new launches; gap between
primary and secondary market prices
all time low
Market Indicators
CapitalValue
New Projects
Projects
Completion
MICRO MARKETS
CAPITAL VALUES
(INR PSF)
% CHANGE
QoQ YoY
Golf Course Road 11,000 - 36,000 0% 2%
Sushant Lok 12,000 - 18,000 -8% -3%
DLF Phase I 11,000 - 13,000 0% 4%
NH-8 10,500 - 18,000 2% 10%
Sohna Road & Ext 6,000 - 11,000 -3% 0%
Market Trends
Research &
Forecast Report
Gurgaon | RESIDENTIAL
April 2016
RentalValue

in both primary and secondary markets on deal to deal
basis.
Rents remained stable in almost all the micro markets
due to limited addition of new supply. However, the
rents in the newly developing areas are far below as
compared to mature markets, as tenants remained
conscious in leasing in these emerging markets due to
lack of social amenities and security concerns.
Several infrastructure initiatives were started in this
quarter in the city, such as street light improvement on
various sectors and construction of sector roads..
Additionally, the construction work of metro rail on Golf
Course Road has also picked up pace. Once
completed, this will boost the connectivity of the sectors
along the Golf Course Road tremendously.
Colliers View
The gap between primary and secondary market rates
for residential units has narrowed down significantly.
Looking at the increase in enquiries for ready-to-move in
projects, the sales volume in secondary markets is likely
to improve in the coming quarters. In the primary
market, projects launched in the mid-segment and
affordable category will continue to remain in buyers
preference. As of now investors choose to remain at bay
from investing in residential properties but with the lower
interest regime in place we expect the investors will
relook at the residential real estate sector. Going
forward, capital and rental values are expected to
remain stable in almost all the micro markets.
FOR RESIDENTIAL SERVICES
Sumit Jain
National Director
Avnish Yadav
Deputy General Manager
Residential Services| NCR
avnish.yadav@colliers.com
Arvind Kapoor
Director
AUTHORS
Surabhi Arora
Research Services
Amit Oberoi
National Director
Technopolis Building, 1st Floor,
DLF Golf Course Road, Sector 54
TEL +91 124 456 7500

NOIDA’s residential market remained stagnant in Q1
2016 with minimal new launches. The focus of the
developers remained on completion of under-construction
projects. A number of projects witnessed phase wise
completion along NOIDA – Greater NOIDA expressway
and sector 72 to 78. In the last two quarters, the NOIDA
Authority has issued completion certificates for more than
35 projects. For these projects, there was a massive drive
to register the property by 31March ,2016 due to
expected increase in stamp duty value.
Although much delayed projects are being delivered in a
trickle, only those that have been delivered with decent
construction quality have seen significant occupancy by
owner-occupiers or by tenants. Such developments were
commanding a premium of nearly 20% over comparable
under construction developments in the vicinity.
The supply of new deliveries has put downward pressure
on rental values in existing mature markets such as
sector 61 to 63 and sector 92 – 93 cluster. The average
capital values remained stable both in primary and
secondary sales market during the quarter.
.
NOIDA witnessed a
number of
completions in Q1
2016
New launches continue to shrink to
rock bottom level
Market Indicators
CapitalValue
New Projects
Projects
Completion
MICRO MARKETS
CAPITAL VALUES
(INR PSF)
% CHANGE
QoQ YoY
Sector 44 9,400 – 10,000 -3% -3%
Sector 92,93 7,700 – 8,300 -11% -7%
Sector 50 7,000 – 7,600 -1% -1%
Sector 61,62,63 5,900 – 6,400 -1% -1%
Sector 28,29,30 5,500 – 5,900 -1% 0%
Sector 100 to 110 5,000 – 7,000 0% 2%
Sector 70 to 79 3,600 – 5,500 0% 2%
Market Trends
Research &
Forecast Report
NOIDA | RESIDENTIAL
April 2016
RentalValue

NOIDA authority has also taken a couple of steps this
quarter to provide relief to the homebuyers struggling with
delay in delivery of apartments, for example, the authority
has decided to upload details of all defaulter builders on
its website. Besides this, an investigation has been
initiated by the authority in a few projects in last quarter
which will help the market to regain the buyers
confidence. However, the impact on primary sale is not
expected to be seen immediately.
On the infrastructure side, the Noida Metro Rail extension
to sector 62 continues to be built at a war footing, along
with the extension to Greater Noida, via sector 78 and
Expressway. Besides this, infra developments projects to
build a number of flyovers on the MP-2 road, making the
route from sec-18 to sec-61 signal free is likely to be
functional by Q1 CY17. These road and rail projects,
once completed shall connect vast swathes of the NCR
and may prove to be the cornerstone of future
development, public or private.
Colliers View
Primary sales market is expected to remain under
pressure while looking at the number of enquiries in
recently completed projects, secondary sale volume
may pick up marginally in the coming quarters.
Completed projects in locations such as Greater Noida
West (Noida Extension), sector 70 to 78 will continue to
garner end user interest due to affordable prices as well
as developers' willingness to reduce the headline prices
along with offers of easy finance schemes and other
freebies. Capital values are likely to remain stable in the
coming quarters across micro markets, while there will
be marginal downward pressure on rental values.
Sumit Jain
National Director
Avnish Yadav
Residential Services| NCR
avnish.yadav@colliers.com
Arvind Kapoor
Director
AUTHORS
Surabhi Arora
Research Services
Amit Oberoi
National Director
DLF Golf Course Road, Sector 54
TEL +91 124 456 7500

During the first quarter of 2016, Chennai’s residential
property market witnessed a 9% dip in new launches
over the previous quarter. Nearly 1,100 new units were
launched during this period, out of which 10% were in soft
launch stage. This dip is attributed to both low recovery in
property markets in the aftermath of floods from a few
months back, as well as delay in approvals owing to
model code of conduct in the wake of upcoming state
elections. Developers maintained a wait and watch
approach as they focused on completion of stalled
projects amidst low sales velocity.
Of the total units launched, mid segment dominated the
launches with an 84% share whilst the rest were
concentrated between high-end and luxury segments.
Perumbakkam, a prominent suburb in the southern part
of the city witnessed the launch of nearly 68% units,
followed by Santhome with a 16% share. Other locations
which witnessed new launches included T. Nagar and
Thiruvanmiyur. Prominent builders that launched projects
during this period included Radiance Developers,
Ceebros, Olympia Group and Shanthi Builders in
locations such as Thiruvanmiyur and Teynampet.
New launches
remain muted in
Chennai
Chennai grapples with low residential
demand during the first quarter of
2016
Market Indicators
CapitalRate
New Projects
Construction
Rental Rate
MICRO MARKETS
CAPITAL VALUES
(INR PSF)
% CHANGE
QoQ YoY
Boat Club 26,000–35,000 0% 0%
Nungambakkam 19,000-26,000 0% -15%
Alwarpet / R A Puram 18,500-26,000 0% -3%
Beasant Nagar 13,500-17,500 0% -2%
Adyar 13,000-17,000 0% -9%
Anna Nagar 13,500-17,000 0% 3%
T Nagar 12,500-20,000 0% 0%
Velachery 7,000-10,000 0% 10%
Sholinganallur 4,800-5,950 0% -3%
Siruseri/ Kazipattur 4,000-6,500 0% 0%
Market Trends
Research &
Forecast Report
CHENNAI | RESIDENTIAL
April 2016

New supply of ready-to-move in units remained low as
very few projects in central areas such as Kotturpuram,
Nungambakkam and Mylapore became available for
possession this quarter. All the new supply belonged to
high-end segment with price range varying from INR
15,500 – 21,000 per sq ft.
Capital values across micro markets remained stable
mainly due to low demand. Rental values dipped by 6-8%
over the previous quarter in Anna Nagar and Velachery
as both were heavily affected by floods in the last quarter.
Nungambakkam and Alwarpet/R.A. Puram too witnessed
12-16% rental dip as a result of low demand at higher
rentals forcing landlords for price correction.
Colliers View
Residential real estate market may remain stagnant due
to the upcoming Tamil Nadu Assembly elections in May
2016. However, new launches may decline further as
end-user demand remains subdued and the state
government is yet to implement the regulations as per
Real Estate (Regulation and Development) Act, 2016.
Micro markets such as Anna Salai, Teynampet and
Kilpauk may witness an uptick in supply as some
projects are currently in soft launch stages. The
inauguration of the country’s first rail auto hub in
Walajabad will give a boost to the realty sector in
nearby micro markets such as Oragadam and
Sriperumbudur. Rental values and capital values may
further correct as developers may rationalize prices to
increase sales velocity.
Note: Rental Values in INR per sq ft per month
Sumit Jain
National Director
A. Velumuni
Residential Services | Chennai
velumuni.a@colliers.com
Arvind Kapoor
Director
Surabhi Arora
Research Services
Amit Oberoi
National Director
Divya Grover
Senior Manager
Research Services
divya.grover@colliers.com
Heavitree Complex, Unit 1C, 1st
Floor, 23 Spurtank Road, Chetpet
TEL +91 44 2836 1064

Bengaluru’s residential property market witnessed the
launch of nearly 6,000 new residential units in the first
quarter of 2016. This represents a quarterly increase of
26% over the previous quarter, even though developers
are concentrating efforts on completing under
construction projects in an oversupplied market.
Of the total launches in this quarter, nearly 18% were
currently in the soft launch stages. Eastern (52%) and
northern (34%) regions witnessed the maximum number
of new launches, mainly in locations such as Devanahalli,
Yelhanka-Doddaballapur Road and Harlur. Other
emerging locations such as Varthur and Off Yemalur
Road in the eastern quadrant witnessed the launch of
high rise projects in apartment formats by reputed
builders such as Prestige Developers and Sobha
Developers, amongst others.
Almost all units launched in this quarter catered to the
mid segment category signaling developers’ focus on
introducing products keeping in mind end-users’
affordability and preferences. Similarly, this quarter did
not witness the launch of villa projects and the entire new
launches were in high-rise apartment complexes format.
Uptrend in new
launches in Q1
2016
Northern and Eastern quadrant
remain hotspots for future supply
Market Indicators
CapitalRate
New Projects
Construction
Rental Rate
MICRO MARKETS
CAPITAL VALUES
(INR PSF)
% CHANGE
QoQ YoY
Central 20,000-30,000 0% 4%
Cooke Town 7,500-14,000 0% -7%
Jayanagar 8,500-10,500 0% 6%
Sadashivanagar (Palace
Orchards)
9,000-15,000 0% 0%
Airport Road 8,500-11,000 0% 8%
Indiranagar 8,000-12,000 0% 0%
Bannerghatta Road 4,500-8,500 0% 0%
Koramangala 6,500-10,500 0% 3%
Whitefield 4,200-8,500 0% 0%
Yelahanka 4,000-10,000 0% -3%
Market Trends
Research &
Forecast Report
BENGALURU | RESIDENTIAL
April 2016

Prominent project completions included Mahaveer
Riviera in J.P. Nagar Phase V and Vaswani Reserve on
Outer Ring Road amongst others.
Capital and rental values remained stable across micro
markets.
Bangalore Metro Rail Corporation (BMRCL) has received
a green signal from the Commission of Railway Safety
(CRS) for the inauguration of the 4.8 kms underground
stretch of East-West corridor of the Bengaluru Metro. This
will help in decongesting inner city areas near central
business district.
Colliers View
As the real estate sector is at the cusp of major
regulatory reforms with the introduction of Real Estate
(Regulation and Development) Act, 2016, new
construction and launches are expected to witness a
downward trend whilst capital and rental values,
supported by end-user demand that is expected to hold
steady. Towards the end of this quarter, guidance
values along with property taxes have been revised
across the city which may give a fillip to capital values in
the short term for certain locations going forward.
Certain emerging corridors such as Varthur-Panathur
Road and locations in north and south such as
Devanahalli and Sarjapur Road will continue to witness
momentum in new launches due to end-user demand
for self occupancy and investment purposes both.
Sumit Jain
National Director
Aakanksha Anand
Senior Manager
Residential Services| Bengaluru
aakanksha.anand@colliers.com
Arvind Kapoor
Director
Surabhi Arora
Research Services
Amit Oberoi
National Director
Divya Grover
Senior Manager
Research Services
Prestige Garnet, Level 2, Unit
No. 201/202, 36 Ulsoor Road
TEL +91 80 4079 5500

Pune’s residential property market witnessed the launch
of more than 2,200 new units during this quarter. All the
new units launched catered primarily to the mid segment
and were concentrated in eastern and western quadrants
of the city due to consistent demand from IT-ITeS
workforce and the city’s manufacturing sector base.
Proximity to other IT-ITeS hubs in the vicinity and future
capital value appreciation is also an added advantage for
developers to introduce launch in these micro markets.
Developers such as Godrej Properties, Purvankara
Projects Ltd. and Kotle Patil Developers were amongst
those who introduced new products in the market.
Prominent completions included projects from builders
such as Mittal Brothers, Nyati Developers and Mantra
Properties. All the new project completions were
attributed to the mid segment and augmented supply in
locations such as Balewadi, Tathawade, NIBM and
Wagholi.
Capital values maintained status quo during this quarter,
however, rental values in some micro markets such as
Magarpatta, Hadapsar, Deccan and Camp registered a
High inventory in
residential segment
curtails new
launches
Steady demand in affordable segment
in eastern and western suburbs
Market Indicators
CapitalRate
New Projects
Construction
Rental Rate
MICRO MARKETS
CAPITAL VALUES*
(INR PSF)
% CHANGE
QoQ YoY
Deccan/Camp/Boat Club 7,000-15,000 0% -8%
Kalyani Nagar/Viman
Nagar/Kharadi
5,800-16,500 0% -2%
Baner/Hinjewadi/
Wakad/Pashan
4,800-9,500 0% 0%
Magarpatta/Hadapsar 4,800-7,800 0% 0%
Kothrud/Bavdhan/Wajre 6,200-12,000 0% 0%
NIBM/Undri/Kondhwa 4,400-6,250 0% -8%
Pimpri/Chinchwad/Chakan 4,700-5,800 0% -4%
Market Trends
Research &
Forecast Report
PUNE | RESIDENTIAL
April 2016

4-5% quarterly dip due to low demand coupled with
ample options.
Even though high levels of unsold stock deterred
developers from launching new products, high income
levels and falling interest rates kept end-user demand in
affordable segment steady.
Pune has also been selected in the list of top 20 Smart
Cities in the first phase for which strategies are being
formulated by civic administration bodies to implement
the INR 3,840 crore plan for the city’s upgrade over the
next five years.
Colliers View
Strong macro economic fundamentals coupled with
positive outlook from multinationals for expansion in
Pune as a choiced location is expected to work in favor
of the residential sector even as the countrywide
market sentiment remains muted. New launches may
remain stable in the next quarter as developers’ focus
efforts on completion of under construction projects and
sales of piled up inventory. Capital values, on the other
hand, may witness marginal appreciation in some
suburban areas near EON Free Zone and IT-ITeS
hubs such as Kharadi, Wagholi and Wakad.
Infrastructure upgrades such as the much awaited Bus
Rapid Transit System (BRTS) on Nagar Road will help
improve connectivity across Wagholi, Kothrud,
Swargate amongst others and give a fillip to their
residential segment.
Sumit Jain
National Director
AUTHORS
Surabhi Arora
Research Services
Amit Oberoi
National Director
Divya Grover
Senior Manager
Research Services
Arvind Kapoor
Director
5th Floor, Suyog Platinum Towers,
Naylor Road, Off Mangaldas Road
TEL +91 20 4011 1356

ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult
their professional advisors prior to acting on any of the material contained in this report.
About Colliers International Group Inc.
Colliers International Group Inc. (NASDAQ: CIGI; TSX: CIG) is an industry leading global real estate services
company with more than 16,000 skilled professionals operating in 66 countries. With an enterprising culture
occupiers, owners and investors worldwide. Services include strategic advice and execution for property
solutions; appraisal, valuation and tax consulting; customized research; and thought leadership consulting.
help clients accelerate their success. Colliers has been ranked among the t
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Primary Authors:
Surabhi Arora
Senior Associate Director | Research
+91 124 456 7500
Divya Grover
Senior Manager | Research
Amit Oberoi
National Director
Valuation & Advisory Services & Research
Colliers International
DLF Golf Course Road,
Sector 54, Gurgaon - 122 002
TEL +91 124 456 7500
Sumit Jain
National Director | Residential Services
Arvind Kapoor
Director | India Operations, Residential Services
For Residential Services:

Residential Property Research and Forecast Report - April 2016

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