After picking up briefly in 2010 and 2011, the average absorption rate of residential real estate in seven key cities in India has fallen to 14.3% in the first three quarters of the calendar year, lower than post Lehman crisis levels, indicating a persisting pressure on residential property sales.

Absorption rate is the rate at which available houses are sold in a specific market in a given time frame, and in percentage terms, is calculated as number of sales per 100 available properties. Lower absorption rate also indicates that inventories would take longer to get cleared.

The average absorption rate for the first three quarters is lower than about 15% average absorption rate in the first three quarters of 2009, when India?s real estate markets slumped post the 2008 global financial crisis. The rates were calculated based on data provided by global real estate consultants, Jones Lang LaSalle India.

Key markets like Mumbai, Pune, Bangalore and Chennai contributed most to the falling absorption rate, as supply took longer to get consumed. Other markets like Kolkata and Hyderabad did not see new supply coming in. Delhi & the National Capital Region is considered primarily investor-driven, and therefore, bucks the trend.

According to Ashutosh Limaye, head (research), Jones Lang LaSalle India, in most Indian markets, post 2008, real estate developers were quick to adapt to the changing realities and there was a surge in supply in the affordable and middle income group housing, which led to a surge in sales. After falling to a historic low of 9.3% in the first quarter of 2009, absorption rates started climbing to 14.3%, 21.3%, and correcting a bit again to 15.2% in the subsequent quarters, JLL data shows.

Mumbai, too, bracketed as an unaffordable premium market, did not see may launches in the city centres or even between prime suburbs of Bandra and Andheri. ?In the last three years, eastern and western suburbs Goregaon, Vikhroli, Kanjurmarg, Thane and Navi Mumbai saw project launches at around R4,500 to R5,000 per square feet, which aided supply in overall Mumbai,? said Limaye.

However, after touching levels between 19% and 21% in calendar year 2010 till first half of 2011, in the last five quarters or 15 months, the absorption rate has again remained at sub 15% level.

Sumesh Misra, senior vice-president (finance), Sunteck Realty, said, ?It is because the supply has grown exponentially in the last two to two and a half years. While the sales continue to happen, supply far exceeds the sales.? This, he said, skews the calculations.

Lalit Kumar Jain, president, Confederation of Real Estate Developers Associations? of India (Credai), said the numbers could have been lower in 2009.

?Post-Lehman, the job market was bad and the real estate market was shattered. There would hardly be absorption of 3% to 5%,? he said.