gera pune realty report july13
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7/29/2019 Gera Pune Realty Report July13
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Jan 2013 - June 2013
PUNE RESIDENTIAL REAL ESTATE REPORT
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
The period between January 2013 and June 2013 witnessed a significant infusion of supply in the form
of 494 new projects alone adding 27,008 units and 25,215 units were added to existing projects. This
led to the Pune Realty market expanding by 20.30% from December 2012 to June 2013 (as against 12%
in the previous 6 months). The total number of units gross supply (considering both, under
construction and in ready projects with stock to sell) is 252,054 spread over 2273 projects. All in all this
is a significant expansion of the market. Of the total stock, 79.48% is currently sold out. The total unsold
stock now stands at 51,725 units. The sold stock in December 2012 was 80.15% while the sold stock in
July 2013 was at 79.48%.
Even with substantial supply being added, the market continues to show remarkable stability in terms of
sellout the average unsold stock has remained steady in the range of 21% since June 2011 (Fig 1)
126240 (78%) 133589(80%)147605(79%)
167938(80%)
200329(79%)
35510 (22%)33871(20%)
39473(21%)
41583(20%)
51725(21%)1779
16411750
1813
2273
0
1000
2000
Jun 11 Dec 11 Jun 12 Dec 12 Jun 13
0
50000
100000
150000
200000
250000
300000
No.ofProjects
Residentia
lUnits
Fig 1 - Overall Supply SituationUnsold Stock
Sold Stock
No of Projects
Total Units - Gross Supply
June 11 (1,61,750), Dec 11(1,67,460),June 12 (1,87,078), Dec 12 (2,09,521), June 13 (2,52,054)
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
Over the last 6 months, the average market price has risen from Rs. 4211 per sf. up 6.01% to Rs. 4464
per sf. The average prices a year ago were Rs.3970 per sf . (the YoY increase, Jul 12 to Jun 13 has been
12.44%). Even though the absolute prices have gone up, the speed of increase has reduced. The last 12
months has seen a price increase of 12.44% where as the price increase for the previous 12 months was
14.87%. This trend is also reflected in the more sensitive, six monthly price momentum which at 6.01%
is slowly trending downwards (Fig 2a & 2b)
The total unsold stock of 51,725 is approximately 6 months of inventory which is a very comfortable
situation from an inventory overhang perspective.
The inventory overhang position has increased to 6 months on an overall basis. When viewed in
isolation, this can be viewed as a cause for concern, however, since this is happening on account of an
increase in supply and not on account of demand tapering off indicates that while there is no major
cause for concern, on an overall basis, the overall market will not see substantive price rises in the near
future. This is true for the market as a whole and indiv idual micro markets will see varying price rises
around the moderate market increments.
6.46% 5.50%
8.29%
6.07% 6.01%
34753666
3970
4211
4464
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
3000
3500
4000
4500
5000
Jan'11 -Jun 11 Jul'11 -Dec'11 Jan'12 -Jun'12 Jul'12 -Dec'12 Jan'13 -Jun'13
%
Change
AveragePric
e(Rspsf)
Fig 2a - Six Months Price Movements
6 month % change Average Price
12.32%
14.24%
14.87%
12.44%
3666
3970
4211
4464
0.00%
5.00%
10.00%
15.00%
20.00%
3000
3500
4000
4500
5000
Jan'11 -Dec '11 Jul '11 -Jun '12 Jan '12 -Dec '12 Jul '12- Jun '13
%Change
AveragePrice(Rspsf)
Fig 2b - Yearly Price Movements
12 month % change Average Price
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
MARKET SUPPLY/AVAILABILITY
BREAK UP OF SUPPLY BY SIZE OF APARTMENTS
When we look at the total unsold stock and divide it based on the size of the flats, we find that the
maximum number of unsold apartments (15,478) is in the range of 751 sf. to 1000 sf. In fact, out of a
total unsold stock of 51,725, 60% of the flats are below 1000 sf. This clearly indicates that the
developers are focusing on the value and affordable segments of the market.
Fig 3 shows the number of unsold apartments broken up by size of the apartments over the last 4
reports. There is a notable increase of supply in the 501-750 Sq.ft. size segment, with stock climbing up
sharply by 28.72% (from 11,145 in Dec-12 to 14,346 in June 13). Roughly 60% (8983 units) of the 15,748
units unsold are from the fresh supply launched during the past six months. This jump is clearly due to
the fresh supply launched in this size segment.
479
9554
10163
7362
2985
2101
1227
597
9477 1
2036
9121
4428
2408
1406
735
11145
12564
8672
3903
2533
2031
1428
14346
15478
10322
4245
3284
2622
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
Lessthan500
501-750
751-1000
1001-1250
1251-1500
1501-2000
Above2001
Unsold units - Dec 11
Unsold units - June 12
Unsold units - Dec 12
Unsold units - June 13
60% of stock under 1000 Sq Ff
category ( June 2013)
No of Projects : Dec 11 (1641) June 12 (1750) Dec 12 (1813) June 13 (2273)
Unsold Apartments: Dec 11 (33,871) June 12 (39,473) Dec 12 (41,583) June 13 (51,725)
Fig3: Size wise Breakup
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
BREAK UP OF SUPPLY BY BUDGET
Roughly 53% of the stock is below the 40 lakhs cost bracket while 87 % of the stock is under 75 lakhs.
Approx. 13% of the unsold stock is above 75 lakhs. The presence of almost 1 3.15% of unsold apartments
in the 75 lakh+ bracket (as against 11.52% in December 2012 & 7.2% in June 2012) confirms that there
has been a consistent shift towards catering to the high end segment of the market (Fig 4), however,
the shift is more in the 3 & 4 bedroom segment. There are 3318 unsold apartments between 75 lakhs
and 1 Cr (which stood at 2089 in December 2012 & 1369 in June 2012) while there are 3488 apartments
unsold above 1 Cr (which stood at 2705 in December 2012 & 1474 in June-2012 ). Unsold stock has
increased in both these cost brackets. The Pune Realty Market is in an expansion mode with more
premium homes being launched.
322
6475 7
842
7650
7837
6504
1369
1474
256
6694
9351
7180
6752
6556
2089
2705
92
8020
11709
7759
7826 9
513
3318
3488
0
2000
4000
6000
8000
10000
12000
14000
Less than
10Lacs
11 - 20Lacs 21 - 30Lacs 31- 40Lacs 41 - 50Lacs 51 -75Lacs 75 -1Cr Above 1 Cr
Fig 4 : Unsold Apartments across
2,273 projects = 51,725 (June 13)
Unsold units ( June 12 )Unsold units ( Dec 12 )
Unsold units ( June 13 )
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
AVERAGE PRICES OF APARTMENTS BY SIZE
On analyzing the price points across the market, we find that larger apartments are selling at higher
prices (Fig 5). This is explained by the fact that larger apartments are coming up in more c ity centric and
prime locations. These larger homes also come with higher specifications and amenities that furtherraise the prices. In fact the prices of the larger sized homes have increased at a rate greater than the
lower sized homes which further reiterates the demand for premium homes is picking up pace on the
back of home buyers looking to upgrade.
3222
3759
3880
4295
4886
5450 7
328
7371
4927
3367 4
102
4075 4
621
5151 6
285
8334
9225
5408
3603
4061
4305
4935
5475 7
011 8
669 9
781
6145
0
2000
4000
6000
8000
10000
12000
1 BHK 1.5 BHK 2 BHk 2.5 BHK 3 BHK 3.5 BHK 4 BHK 4.5 BHK Others
Fig 5 - Bedroom wise Price Breakup (Rates are Simple Averages,
Rates in Rs/sf = Simple Average)Simple Average -June 12Simple Average -Dec 12
Simple Average -June 13
No Of Projects : June 12 (1750) Dec 12 (1813) June 13 (2273)
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
LOCATION BASED ANALYSIS
We divided the city into 6 zones each consisting of numerous neighborhoods/micro markets. The zones
covered are listed below-
Zone 1: Nagar Road | Vimannagar | Kharadi | Wadgaonsheri | Vishrantawadi | Dhanori | Wagholi
Mundhwa | Keshav Nagar | Ghorpadi | Bolhai | Kalas | Koregaon Bhima | Lohegaon | Lonikand
Sanaswadi | Shikrapur | Talegoan Dhamdhere
Zone 2: Hadapsar | Mohammedwadi | Fursungi | Manjari | Uruli Kanchan | Lonikalbhor | Kondhwa
NIBM Road | Bibvewadi | Undri | Lullanagar | Salisbery Park | Market Yard | Pisoli | Saswad | Yavat
|Yewalewadi
Zone 3: Ambegaon | Katraj | Warje | Dhayari | Narhe | Dhankawadi | Khed Shivapur | Kondhave -
Dhavade | Shivane | Uttam Nagar
Zone 4: Aundh | Baner | Balewadi | Wakad | Pashan | Bavdhan | Sus | Hinjewadi | Pimple Gurav
Pimple Saudagar | Pimple Nilakh | Ambadvet (Ahead of Pirangut) | Baner Pashan Link Road | Bhugaon
Bhugawade | Bhukum | Chandkhed | Mahalunge | Pirangut | Punawale | Sus Road | Tathawade
Urawade
Zone 5: Shivaji Nagar | Model Colony | Prabhat Road | Mukundnagar | Sahakarnagar | Koregaon Park
Peth | Ganesh Khind Road | Mitra Mandal | Singhad Road | Kothrud | Karvenagar | Wanowrie
Gultekdi | Vadgaon | Kalyaninagar | Satara Road | Anand Nagar | Bhosale Nagar | Boat Club Road Camp
City | Dattawadi | Fatima Nagar | Gokhale Nagar | Hingne | Khadki | Parvati | Wakadewadi
Zone 6: Akurdi | Bhosari Pradhikaran | Chakan | Chikhali Pradhikaran | Chinchwad | Dange ChowkDapodi | Kalewadi | Kasarwadi | Kiwle | Moshi Pradhikaran | Nigadi Pradhikaran | Pimpri | Rahatni
Sangvi | Talegaon | Alandi | Alandi - Dehu Road | Alandi Moshi Road | Alandi Road | Bhosari | Charholi
Br | Chikhali | Dighi | Kanhe | Moshi | Ravet | Somatne Phata | Thergaon | Wadgaon Maval
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
The average rate across all micro markets put together is Rs 4448 psft. The micro markets that have
witnessed the maximum increase in prices over the last 24 months are listed below ( Fig 6)
Top Ten Highest Gainers (In the last 24 months)
The micro markets that have witnessed the lowest 24 month growth are listed below ( Fig 7)
Bottom 10 Lowest Gainers (In the last 24 months)
Location Price appreciation 24 months
Katraj/Khed Shivapur 1.76%
Koregaon 15.98%
Undri 16.50%
Aundh 16.55%
Ghorpadi (Sopan Baug) 19.62%
Boat Club Road/Tadiwala Road/Koregaon Park/Kalyani Nagar 20.63%
Market Yard/Lullanagar/Salisbury Park/Mukund Nagar 21.10%
Keshav Nagar/Mundhwa 23.38%
Purandar/Saswad 23.96%Lavle 25.26%
Location Price appreciation 24 months
Bakori/Bolhai/Shirsatwadi 75.67%
Vishrantwadi/Kalas 50.88%
Erandwane/Karve Road/Karvenagar/Kothrud 49.01%
Pimpri/Kalewadi 48.31%
Khadakwasla/Kirkitwadi/Kolhewadi/Nanded/Nanded Phata/Panshet 45.46%
Akurdi/Nigdi/Nigdi Pradhikaran 45.26%
Baner 42.23%
Kondhawe Dhawade /Shivane/Uttam Nagar 40.93%
Ambadvet (Ahead of Pirangut)/Mulsi/Tamhini Ghat 40.14%
Dehu/Gahunje/Kiwale/Ravet/Talawade/Tathawade/Punawale 39.44%
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
The chart (Fig8) of newly launched units (new projects + new phases of old projects), clearly suggests
that market expansion is happening evenly. The top two areas with the maximum new supply are
Wagholi and Chakan, both border East Pune and West Pune. The next two areas with maximum supply
(Bhosari and Dhanori/Lohegaon), are also bordering East and West Pune respectively. In fact, from the
top 10 areas where maximum units have been launched, 5 are from West Pune and 5 are from East
Pune.
3700
3243
2965
2955
2697
2503
2
378
2054
1977
1832
1742
1724
1672
1570
1500
1475
1466
1457
1352
1276
0
500
1000
1500
2000
2500
3000
3500
4000
Wagholi
Chakan
Bhosari
Dhanori/Lohegaon
Undri
Dehu/Gahunje/Kiwale/Ravet/Tal
Ala
ndi/Alandi
Kondhwa/Pisoli/Ye
walewadi
Kanhe
/Somatne
NaviSangvi/OldSang
vi/Pimple
Chinchw
ad/Dange
Ambegaon
AnandNagar/Dattawadi/Hingne
Balewadi
Hinjewadi
Fursungi
Wakad
Koregaon
Khadakwasla/Kirkitwadi/Kolhewa
Narhe
Fig 8 - New units Launches (Top 20 micromarkets with the
Fresh Supply Launched)
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7/29/2019 Gera Pune Realty Report July13
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Based on confidential primary research conducted for Gera Developments Pvt. Ltd.
Conclusion
The Pune residential market continues to show resilience amidst a negative economic environment at a
macro level. At a local level, the fact that developers have launched projects in more numbers than ever
before and the sellout ratio continues to be at the average market sell out indicates that the demand
continues from home buyers. The price increases have also tapered off marginally in line with the
reduction in inflation over the last 6 months.
All in all, the market currently seems to be in a state of equilibrium, however, the absolute number of
unsold units can lead to a situation of oversupply if the macro economic conditions deteriorate
drastically. The depreciation of the Rupee in the recent past makes it attractive for NRIs to invest in
India thereby providing developers an alternative customer base.
Our past report of January 2013 had predicted an annual price rise of 13% to 17% with a bias on the
higher side on the expectation of a reduction in home loan rates and pro-reform budget stimulus. Thishowever did not happen. The first 6 months have seen an increase of only 6%.
Looking forward, we believe that the next 12 months have more risks than the last few years on account
of the impending national elections as well as the macro economic situation. Further, the current
macro-economic situation does not seem to leave any room for policies leading to a reduction in the
interest rates. We also expect the cost structures for developers to be negatively impacted on account
of the Real Estate Regulation legislation that is currently being considered by the Government. The draft
in its current form will lead to a price rise this is a fallout of the populist move by the Government to
regulate developers and the effect of price rises for the home buyer can be considered collateral
damage.
Disclaimer: As with other investments, real estate too carries a certain amount of risk. Readers are advised to undertake their
own due diligence and make their decisions based on their own research rather than rely on the article above. Any views offered
above are of the Company and being a real estate developer, there may be a developer side bias in the article.
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