Amidst a slew of annual market reports on Bengaluru’s unsold units of residential property that has persistently been creating confusion amongst end-users, industry bodies and property consultants CREDAI has for the first time partnered with an International Property Consultant (IPC), JLL, to come up with an independent study, ‘Analysis of Unsold Residential Inventory in Bangalore.’ “This independent study that comprises 957 projects and 138 non-CREDAI members is to categorise the market inventory for easy understanding,” said Ashutosh Limaye, National Director-Research, Jones Lang Lasalle (JLL), at the launch.
“Bengaluru only has 4,492 units under its ‘unsold inventory’ as of December 2015 and the city can boast of a healthy residential supply and demand ratio,” said Suresh Hari, Secretary, CREDAI, at the release of the study. The CREDAI and JLL study “re-defined what ‘unsold inventory’ meant” by categorising them into Launched Projects; Under-Construction Projects (also termed to-be-sold inventory); and Unsold Inventory (constructed).
Explaining the categorisation, CREDAI Chairman, Irfan Razak, said, “Bengaluru’s unsold stock of 4,492 units works out to be 2.2 per cent of the total 2,06,753 apartments and villas launched over the last five years. As of December 2015, the city had 82,357 units (apartments and villas) that were in the process of construction, but not sold technically. They were only amongst the ‘stock available’ but had not reached the sales counters due to various technical reasons. So we cannot categorise them under ‘unsold inventory.” “After all, Bengaluru has a buoyant real estate market that has seen Rs. 2,500 crore home loan disbursement and 45,000 units and absorption in equal proportion on an average annually. So the ‘to-be-sold’ and ‘unsold’ statistics should not make a huge difference to the market,” he said.
J.C. Sharma, president of CREDAI-Bengaluru, reacting to the study said “It is important that we take a scientific approach to the development of the city. A scientific tool such as this will help developers understand ground realities and plan their projects.”
With healthy absorption, pricing in the Bengaluru market is also reasonable, said Mr. Limaye. “I will not say the appreciation has been huge, but a moderate one with 5-10 per cent year on year,” he added. Prices may get impacted due to hike in raw material prices going forward. To broadbase the study, it divided the city divided into eight zones along the prominent roads for micro-analysing sub-markets. North Bengaluru, East Bengaluru and Sout-East Bengaluru had the most number of completed projects along with an equal number under construction.
