The collective unsold housing stock in the three key cities of Uttar Pradesh has declined by 26% in two years, from 1,31,150 units in Q3 2017 to about 97,270 units by the Q3 2019-end.
After a long spell of doom and gloom, there is finally some good news for the nation’s real estate sector. According to industry reports, the collective unsold housing stock in the three key cities of Uttar Pradesh — ie, Noida, Greater Noida and Ghaziabad — has declined by 26% in two years, from 1,31,150 units in Q3 2017 to about 97,270 units by the Q3 2019-end, which is the maximum decline in the state.
A joint report by ANAROCK and NAREDCO, released recently, stated that Greater Noida witnessed the maximum stock reduction by 27% in Q3 2019 as against Q3 2017, while Noida and Ghaziabad each saw a 24% decline during the period. Faridabad saw a mere 4% decline, while Gurugram and Delhi reported unsold stock increase by 7% and 20%, respectively.
Citing the reason behind this decline in unsold housing stock, Anuj Puri, Chairman, ANAROCK Property Consultants, says, “The key UP cities of Noida, Greater Noida and Ghaziabad have managed to substantially bring down their pent-up housing inventory, largely because the developers active in these cities have taken a conscious call to moderate the supply of new housing projects in favour of bringing their existing projects to completion. The Millennium City of Gurugram alone launched over 2,030 in Q3 2019; however, Noida, Greater Noida and Ghaziabad together saw the launch of only 1,610 units in this period.”
As per Puri, Greater Noida topped out in terms of reducing its unsold inventory by as much as 27% in two years, bringing it down to 48,350 units in Q3 2019 from the 66,570 units on the market in Q3 2017.
The ANAROCK-NAREDCO joint report has given a shot in the arm of Delhi-NCR developers who were betting big on the festive sales for revival of their fortunes. Although the subdued festive sales failed to cheer the sector, the findings of this report have given them some hope.
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Commenting on the same, Yash Miglani, Managing Director, Migsun Group, says, “The report is the validation of our observation that the real estate market, especially in Delhi NCR, is witnessing the maximum change after the confidence building policy measures were announced by the government. The decline in unsold inventory is an indication that buyers are now out to grab the opportunities as early as possible to enjoy the fruit of lower EMIs, among many other benefits.”
Dhiraj Bora, Head Marcomm, Paramount Group, is hopeful that going by this trend, the rest of the inventory will also get cleared soon. “The Delhi NCR market has kept itself up-to-date with the changing consumer preferences and rising demand. The unsold inventory piled up in the past because of the growing distrust, which has now been addressed by the government on time. We are sure that the rest of the inventory too will be done away with very soon,” he says.
Gaurav Gupta, President, CREDAI Ghaziabad and Director, SG Estates, believes that this decline in unsold inventory also means that customer confidence has increased in the sector. “As of now, the focus of developers is on delivering the projects at hand and thus provide buyers a market that they were looking for — a market full of ready options to choose from. It is a heartening report and the situation will give impetus to the launch of new projects. Another indication that can be gauged from this report is that there is a likelihood of rise in the prices in the near future,” he observes.
Mohit Goel, CEO, Omaxe Group, says, “A lot of factors have contributed towards lowering of unsold inventory, including the government’s announcement of additional tax deduction of Rs 1.5 lakh for houses priced up to Rs 45 lakh, reduction in interest rate, linking it to the repo rate, and finally the stability in property prices. Also, with RERA well and firmly in place, buyers’ confidence in the sector has been restored and that is reflected in the sales number as well.”