Related
(This story originally appeared in 
on Mar 30, 2020)
BENGALURU: Sale of residential apartments dropped 42% to 45,200 units in the first quarter compared to the same period a year earlier, data from property consultancy firm Anarock showed. on Mar 30, 2020)The fall is largely on account of the coronavirus impact in March, which forced the country into a lockdown.
New launches too fell by 42% to 41,200 units across the top seven cities, from 70,480 in the same quarter last year. Mumbai and Pune recorded the maximum year-on-year drop in housing supply -- by 61% and 56% respectively -- while Chennai and Kolkata were up 16% and 8%.
“As expected, monthly data trends reveal that March -- the month when most advisories and lockdown were imposed -- saw a steep decline in both new launches and housing sales against the preceding two months,” Anarock chairman Anuj Puri said.
The impact of the coronavirus was expected to be a setback for the already struggling residential market, as site visits from potential customers dropped abruptly and builders deferred launches. Construction activity has also been halted as part of the shutdown and many labourers have rushed back to their native villages out of fear.
Hyderabad recorded the steepest fall in sales by 50%, while other cities saw their sales dip by nearly 40%. With sales in ongoing projects likely to see a drop in collections and construction activity likely to slow down in case the Covid-19 issue lasts longer, developers with strong balance sheets will be best placed to weather the storm.
Last week, ICICI Securities termed this epidemic as a “black swan” moment for the Indian real estate sector.
“With residential real estate typically being a ‘touch and feel’ high ticket purchase, any extended spell of social distancing owing to Covid-19 may lead to cash flow management issues in ongoing projects where a fall in collections may lead to a drop off in construction activity. Further, new launches planned in April-May 2020 will be pushed back till at least September 2020 to coincide with the festive season,” ICICI Securities said.
