2015 ends with the lowest new launches and sales volume since 2010 for residential, while office market records highest occupancy at 84.2%: Knight Frank India
Knight Frank India today launched the 4th edition of its flagship half-yearly report - India Real Estate. It presents a comprehensive analysis of the residential and office market performance across seven cities for the period between July–December 2015 (H2 2015).
Knight Frank India today launched the 4th edition of its flagship half-yearly report - India Real Estate. It presents a comprehensive analysis of the residential and office market performance across seven cities for the period between July–December 2015 (H2 2015). The report also includes the residential market analysis of Ahmedabad for the same period.
- •Current unsold inventory levels stand at over 6.9 lakh units; would take more than 2.5 years to exhaust
- •NCR is the worst affected market in India; both launches and absorption fail to pick up
- •Market sees a sharp drop in price growth; reduces from 9% - 3% in the last 36 months
- •New launches fall by 13% Y-o-Y during H2 2015 from 1,50,471 to 1,31,445 units
All-India Residential market launches and absorption
All-India Residential unsold inventory
All-India Residential price growth
- •Severe shortage of good quality office space; demand consistently surpassing supply since 2014
- •Vacancy levels touch record 8 years low to 15.8 % in 2015 from 17 % in 2008; it had peaked at 21 % in 2012
- •H2 2015 sees highest half-yearly surge since H2 2012, but new completions still below their peak levels
- •Chennai, Pune lead in terms of absorption growth, while NCR the absorption went down 10 % compared to H2 2014
All-India Office market trend
Annual Vacancy Trend
Says Shishir Baijal, Chairman & Managing Director, Knight Frank India: “2015 for Indian real estate had both the good and bad news. While the office market grew from strength to strength, residential did not perform as per expected.
Office market saw a record absorption at 40.4 mn sqft; highest since 2012. Supply of quality office space now a concern with vacancy levels at an eight-year low. Rentals have firmed up as a result. Among sectors driving growth, IT/ITeS continues to lead with start-ups. This year, however, we saw e-commerce and start-ups contribute to the office space uptake in a major way.
Going forward, we have to wait to see if this trend continues. Residential, on the other hand, continue slow down with launches at a five-year low, despite the festive season. Sales in 2015 were lower than 2014 levels. Despite the 125 bps rate cut by RBI, demand did not see an uptake. Our outlook for 2016 remains muted. To further revive the demand, it is important to transmit the benefits of the rate cuts to consumers.”