Real Estate, Demand Stable, Says Emkay Global

Demand for the real estate sector is stable sequentially, though year-on-year comparison is still favourable, Emkay Global has stated in its latest report on the real estate sector.

"For Tier 1 Indian cities, new launches continued to decline in Feb'21 (down 18% yoy), while absorptions rose 13% year on year (YOY) after a mere 3% decline in Jan'21. Overall demand trends depict a strong recovery across markets. Accordingly, unsold inventory (in units) was down 11% yoy at 33 months from 29 months in Feb'20. TTM absorptions were down 20%, while new launches fell 46%.

MMR market witnessed 10% yoy growth in absorptions even as new launches were down 35%. Unsold inventory (in units) was, thus, down 15% yoy at 30 months (similar levels as Feb'20). TTM absorptions were still down 18%, while new launches were down 45%," the report has stated.

According to Emkay Global, NCR market saw a modest increase of 4% yoy in absorptions due to a sharp pick-up in new launches (5.85x Feb'20 levels). Unsold inventory was, however, down 8% yoy at 88 months from 56 months in Feb'20 on account of better absorptions in the past few months. TTM absorptions were down 41%, while new launches were down 54%.

Bengaluru recorded a 7% YoY drop in unsold inventory, the biggest decline in 18 months, driven by a 26% drop in new launches. Demand was up 12% yoy for the month. For the TTM period, absorptions were down 33%, while new launches were down 43%.

Among other key markets, Pune and Hyderabad stood out. Pune reported a 25% rise in absorptions in Feb'21 and Hyderabad absorptions rose 19% yoy. While TTM absorptions declined 18% in Pune, Hyderabad witnessed a 23% decline. TTM new launches, however, were down 55% YoY in Hyderabad and 34% in Pune, thus driving down unsold inventory by 16% in Pune even as Hyderabad witnessed 12% growth.