Housing sector sees revival in June quarter, new launches rise 241%

However, despite the traction in the market, the number of new launches fell by 20% compared to the previous quarter
Last Updated 17 August 2021, 16:33 IST

In another sign of revival of the economy, the residential real estate segment witnessed the launch of several new projects across key cities during the second quarter of the calendar year ended June.

The quarter witnessed the launch of 17,640 units across Bengaluru, Chennai, Hyderabad and Kolkata, during Q2 2021, an increase of 241% compared with the number of units launched in the corresponding quarter last year. Both buyers and developers stayed away from the market during the quarter due to Covid-19-induced lockdown.

However, despite the traction in the market, the number of new launches fell by 20% compared to the previous quarter. The first quarter of the year witnessed the launch of 7,378 units.

The second Covid-19 wave disrupted the businesses during the quarter, property consultant Vestian Global said in a research report.

Hyderabad continued its growth momentum witnessed in Q4 2020 and led the way with the maximum number of units launched amongst the four cities in Q2 2021, and its share was 50% of the total new launches. Bengaluru followed Hyderabad, accounting for 37% share. Chennai and Kolkata brought up the rest with a 9% and 5% share of the total new residential launches in the four cities.

Bengaluru witnessed 2.5 times (154%) jump in new launches at 6,451 units compared to 2,537 units in the corresponding quarter last year.

"This implies that Bengaluru's residential market held the prospect of a comparatively faster recovery in the face of the pandemic, given that the major employment driver in the city - the IT/ITES sector, remained in a relatively better position than the other sectors," the report said.

The reduction of stamp duty on properties worth up to Rs 45 lakh by two percentage points also helped the industry launch new projects. A home buyer will now have to pay 3% stamp duty at the time of registration, as against 5% earlier.

The majority of the new launches were in mid-segment housing, priced in the range of Rs 45-75 lakh.

"A positive facet observed during the quarter riddled with the second wave-induced lockdowns was the fortitude shown by developers towards launching their projects," Shrinivas Rao, CEO-Asia Pacific, Vestian Global Workplace Services Pvt Ltd said.

Much-needed relief from the government, such as loan restructuring schemes and credit infusion, enthused the developers. These have spurred the supply side into activity during the first half of the year, he said.

(Published 17 August 2021, 16:33 IST)

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