On-time delivery for home buyers remain a promise unfulfilled

Mar 15 2014, 13:39 IST
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The top 15 cities in the country witnessed a sharp jump in their completed real estate residential units in the last five months of calendar 2013. The top 15 cities in the country witnessed a sharp jump in their completed real estate residential units in the last five months of calendar 2013.
SummaryImproved sentiments are seeing a rise in new launches, but the impact is yet to be felt on completion of projects underway.

the buildings ready and then wait for customers to come in. They have been trying to buy time to get sales,” said Gulam Zia, national director-research at Knight Frank, a real estate consultant.

While Ahmedabad is the only city among the 15 cities in the list to have surpassed the estimated supply at the end of December 2013, Delhi-NCR seems to be the worst performing in terms of timely completion, which translates into delayed delivery of homes to the buyer. While in July, it was expected that Delhi-NCR would add 70,187 units between August and December, the region added only 29,090 units, falling short by 41,097 units or close to 60 per cent of the estimated supply to have been added.

The Mumbai Metropolitan Region (MMR) market stands second in the rankings for falling short of thecompletion target. While the number of units that were estimated to be added between August and December stood at 70,960, the actual number of units added were 33,308 and therefore fell short by 37,652 units or 53 per cent of the total units to have been added. Bangalore, Chennai and Kolkata too fell short of their estimated supply by 45-47 per cent. While the developers have been slow on delivery and have been defaulting on their timely delivery commitment to the home buyers, the sharp rise in the supply is also a concern as the demand has simply failed to keep pace.

In the five month period, the completed supply in the 15 cities rose by 102 per cent from 1,43,838 units in July 2013 to 2,90,926 units in December 2013.

While Ahmedabad witnessed the biggest jump of 266.8 per cent from 9,215 complete units in July 2013 to 33,803 units by the end of December 2013, Delhi-NCR witnessed the second biggest rise in completed inventory, which rose by 136 per cent from 21,371 to 50,461 units.

The MMR comprising Mumbai, Navi Mumbai and Thane too saw the completed residential inventory rise by 87 per cent from 38,198 units in July 2013 to 71,506 units in December 2013. In absolute terms, the region had the largest number of completed deliveries towards the end of the calendar year.

The supply side concerns, however, continue to fester. Not only will there be addition in the number of units on account of the old unfinished projects getting completed in 2014-15, a large number units are also expected to be added on account

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