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INSITE REPORT 2018 July - September

99acres ’s No.1 Property Portal 99acres India’s No.1 Property Portal INSITE : BANGALORE 3

From CBO’s Desk

The Indian real estate sector finally bid adieu to the prolonged impasse which started with demonetisation and worsened with RERA and GST ambiguities. Recovering property enquires, Contents sales volume and prices were testimony to a progressive market sentiment. Barring Chennai and Pune, where average weighted property prices remained unchanged this quarter, From CBO’s Desk Maneesh Upadhyaya Chief Business Officer all other metro cities witnessed the capital rates increasing CBO’s perspective on current 03 marginally versus the previous quarter. Hyderabad remained market 99acres.com at the forefront with a two percent rise in ‘ask’ rates.

National Outlook While unsold inventory trimmed in both new projects and resale 04 Snapshot of real estate ambience markets, project launches in affordable housing segment across top 8 metro cities gained momentum. Multiple efforts towards strengthening infrastructure, a pro-buyer regulatory environment in the Market Indicators country and unchanged interest rates are expected to 05 Changes in capital rates and inventory push the housing sector on a growth trajectory with status QoQ; and rental values YoY improvement in fresh supply and sales volume in the ensuing quarters. Market Movers News that impacted Bangalore’s 06 realty market in Jul-Sep 2018 99acres Outlook Methodology 07 99acres’ perspective on current market The Insite Report by 99acres.com captures the quarterly capital trends and the annual Bangalore rental analysis of residential apartments 08 Key highlights - Bangalore’s capital in key real estate markets – Delhi NCR, Mumbai and rental market in Jul-Sep 2018 Metropolitan Region (MMR), Bangalore, Pune, Chennai, Hyderabad, Kolkata and Annexures Ahmedabad. In order to assess the prevailing sentiment, the report delves deep into demand 10 and supply of properties across varied budget segments and occupancy stages. While demand is a function of queries received, supply is based on property listings posted on 99acres.com in Jul-Sep 2018. 99acres India’s No.1 Property Portal INSITE : BANGALORE 5 MARKET INDICATORS

Capital Values Rental Values Supply Bangalore ˄ ˄ ˅ Delhi NCR ˄ ˄ ˅ Mumbai ˄ ˄ ˄ Chennai ˄ ˅ Pune ˄ ˅ Hyderabad ˄ ˄ ˄ Kolkata ˄ ˄ ˅ Ahmedabad ˄ ˄ ˄ * Capital values represent quarterly change * Rental values represent yearly change * Supply is basis properties listed on 99acres.com NATIONAL OUTLOOK HOME BUYING SENTIMENT IN FOCUS Buyer sentiment remained upbeat in all metros barring Kolkata where the ambiguous regulatory environment restricted sales. While Hyderabad GST ANNIVERSARY witnessed increased property enquiries in the pre-election period, Delhi NCR, Mumbai and Bangalore merrily marched towards the festive quarter in hope June 1, 2018 marked the first anniversary of the replacement of the archaic tax policy with the unified of a realty revival with property sales improving this quarter. tax system - Goods and Services Tax (GST) in India. The realty sector, which landed in the 12 percent tax bracket, was freed of multiple taxes such as VAT, Service Tax and Central Excise. Input Tax Credit (ITC) PROPERTY PRICES and the anti-profiteering clause were the two most benefitting features of the new tax system. Except Chennai and Pune where prices remained unchanged, average capital ‘asks’ remained buoyant across metros in Jul-Sep 2018. Capital values in the premium segment remained under check due to a cumulative inventory PROPERTY PRICES overhang of over four lakh units. Hyderabad led all metros with two percent Ambiguities regarding Input Tax Credit and its mode of payment kept the buyers wary of investing in growth in prices, QoQ, owing to the recently launched RERA website. under-construction properties. Despite causing a shift in buyer preference towards ready homes, GST did not trigger a downward price correction. Exclusion of Stamp Duty and Registration charges from GST RENTAL LANDSCAPE increased the total cost of owning a house by 3-4 percent. The seven-quarter growth spree of the rental market continued in the eighth quarter with all metros reporting a spike in the average rentals by AFFORDABLE HOUSING 3-5 percent. Mumbai, Bangalore, Pune and Hyderabad emerged as the The slash in the GST slab from 12 to eight percent firmed buyer’s confidence and demand for the frontrunners in the rental market. With a slow-paced revival in the capital country’s flagship program – Pradhan Mantri Awaz Yojana (PMAY). Although a significant impact market, rental growth is anticipated to continue in the forthcoming quarters. on property sales has not been noted, the rate cut has helped improve buyer sentiment. The move is expected to propel transactions in the affordable housing segment in the longer run. SUPPLY Cities continued to swarm with unsold inventory, albeit lower than the previous RENTAL MARKET quarters but sufficient to restrict capital growth. Hyderabad had the lowest The extension in the monthly limit of maintenance charges to Rs 7,000 for levying 18 percent GST, and on unsold stock, whereas Delhi NCR and Mumbai led the pack with 1.5 lakh and the annual threshold limit from Rs 10 lakh to Rs 20 lakh for the applicability of GST on rent attracted from 80,000 units lying unsold, respectively. The controlled pace of new launches a commercial property or from a residential property used for commercial purposes, eased the tax liability and slow-paced RERA registrations curtailed the saleable primary inventory. on property owners. 99acres India’s No.1 Property Portal INSITE : BANGALORE 7

99ACRES OUTLOOK Market Movers Capital and rental rates in Bangalore strengthened this quarter, although marginally. New launches, however, dipped for the second consecutive quarter across budget Single-window clearance for realty Land Revenue Act, 1984 in a way segments. Of the total new supply, close to only 12 percent fell in the affordable projects that allows the conversion of such properties housing category since developers found it an unviable business proposition. Quashing the need to approach 14 different falling under the Corporation limits to A Khata Buyers, mostly unaware of RERA, maintained a cautious stance towards property government agencies to seek building cheered homeowners. The conversion would investments, marring sales in the segment. The proposed development of nearly approvals, the State formed a single-window require owners to pay the improvement and 60,000 affordable homes in the State under PMAY is expected to smother the clearance mechanism for residential projects conversion charges to the civic body. disparity in demand and supply of homes priced within Rs 40 lakh in Bangalore. covering 1,200 sq ft and more. The online Property sales in the first month of the Jul-Sep 2018 quarter slackened due to the system will approve the projects abiding with Phase II gets delayed withdrawal of buyers during the inauspicious ‘aadi’ period. However, a series of the building norms and zonal regulations After the malfunctioning of the boring reforms this quarter paved the way for growth in Bangalore’s residential landscape. within a month. machines, another hurdle pertaining to land acquisition hampered the construction work On a macro level, the gradually resolving land acquisition issues strengthened Infrastructure projects receive a fillip on the Nagawara- Line of the Namma prospects of development in the city. The decision to regularise B Khata properties The Karnataka government announced the metro. The work is anticipated to resume only and to introduce a single-window clearance mechanism also boosted buyer and development of six inter-connected elevated after the Defence Ministry transfers it to the developer sentiment. The proposed spike in Guidance Values by 10-30 percent corridors, and an addition of 80 electric metro rail corporation. received flak, but propelled buyers to close deals before the prices sprung from buses to improve and augment the use of October onwards, resulting in increased sales towards the end of the quarter. With public transport. In another move, nearly 10 the festive months in the offing, Bangalore closed Q3 2018 on a positive note. infrastructure projects in the city were freed of The ensuing festive quarter is expected to witness renewed interest of buyers as land acquisition issues as the Defense Ministry developers are expected to resurge with freebies and discounts. agreed to hand over 45,465 sq m of land to the State.

State proposes regularisation of B Khata properties Price Movement in Key Micro-markets The proposal to delink B Khata properties from the Akrama-Sakrama Scheme, and amend the LOCALITY AVERAGE ‘ASK’ RATE (PER SQ FT) QOQ CHANGE YOY CHANGE 9,800 - 10,500 4% 4% Indira Nagar 9,700 - 10,600 4% 4% Jayanagar 10,000 - 10,600 1% 10% Whitefield 4,400 - 5,700 2% 8% Raja Rajeshwari Nagar 3,700 - 4,600 2% 2% 4,200 - 5,300 1% 5% 4,600 - 5,900 0% 4% 3,500 - 4,500 3% 3% Hebbal 5,000 - 7,500 2% 8% 4,600 - 6,100 2% 6%

* Average ‘ask’ rates have been calculated as per listings posted on 99acres.com in the current quarter 99acres India’s No.1 Property Portal INSITE : BANGALORE 9

BANGALORE The lull in property sales in July and a KEY HIGHLIGHTS SUPPLY OF APARTMENTS spike in the ensuing months tempered UC RTM DEMAND UC RTM SUPPLY the performance of the capital market Property enquiries maintained status-quo in Bangalore this quarter. The popular hubs of North, East and South Bangalore bagged the maximum in Bangalore this quarter. The rental The marginal improvement in the average weighted capital prices is number of new launches in the city. Overall, the city witnessed close to 6,000 landscape, however, continued to primarily attributed to the positive buying sentiment ahead of the festive new unit additions with Grade A developers taking the lead. Compliance with boom on account of the expanding season and the proposed spike in the Guidance Values. Locations such RERA continued to drive sales in projects priced beyond Rs 40 lakh. Lack commercial market. Improving metro as Sanjay Nagar, Basavangudi and Jayanagar witnessed enhanced sale of awareness amongst the Lower Income Group (LIG) and Middle Income connectivity boosted rental demand in closures in anticipation of the increased circle rates and as a result, Group (MIG) homebuyers resulted in poor response towards RERA-approved erstwhile locations, too, resulting in the reported a price hike to the tune of 1-4 percent, QoQ. budgeted projects. average weighted rental prices to surge

The expanding IT base and improving metro connectivity played an important 85% / 15%

In line with the previous quarters, buyers remained wary of the under- 88% / 12% by four percent, YoY. construction segment. Developers’ attempts at offloading the unsold role in boosting the rental market. The economic hubs of Whitefield in the East inventory of over 62,000 units continued at full gusto, translating into a and in the South remained the epicenters of rental demand.

10 percent reduction in the saleable stock. The inclination towards the While rental rates in locales close to Whitefield, such as , ITPL and 81% / 19% ready or near-ready homes benefitted the developed locales of Indira grew by 6-9 percent, YoY, near Electronic City garnered 82% / 18% Nagar, CV Raman Nagar and Marathapalli in the East, , Begur maximum demand from the tenant community. and Koramangala in the South, and Nagavara, Hormavu and Hebbal The capital and rental landscapes of Electronic City, however, failed to report in the North. Average capital prices in all these areas appreciated by any noticeable improvement owing to an excess of housing stock. The locality 2-4 percent, QoQ. witnessed the launch of a 1,000 more residential units this quarter, spoiling 42% 62% 44% 64% potential buyers and tenants for choices and restricting price growth. Rental Jul-Sep 2018 Apr-Jun 2018 rates in the area vary between Rs 15,000 and Rs 20,000 per month. * Graph depicts the availability of residential apartments wrt other property types, QoQ, along with the distribution 8% 8% 8% of under-construction and ready stock BUDGET-WISE SUPPLY OF PROPERTIES 6% 7%

DEMAND SUPPLY 21% 37% 40% 38% 20% 19% 0%

3% -1%

2% 2% 2% -2% 1% 1% 27% 27% 28% 29% 30% -19% -18% 31%

0% 0% 0% 3% -25% 0% 0% 0% 0% 0% 0% 17% 0% 15% 16% -1% -1% 1% 1% 8% 10% 9%

25% 10% 10% 10% 10% 27% 27% 19% 19% 15% 17% 16% 18% 8% 9% 8%

Nagar Jul-Sep Apr-Jun Jul-Sep Jul-Sep Apr-Jun Jul-Sep Jul-Sep Apr-Jun Jul-Sep Jul-Sep Apr-Jun Jul-Sep Jul-Sep Apr-Jun Jul-Sep 2018 2018 2017 2018 2018 2017 2018 2018 2017 2018 2018 2017 2018 2018 2017 Within Rs 40 Lakh Rs 40-60 Lakh Rs 60 Lakh - Rs 1 Crore Rs 1-2 Crore Rs 2 Crore and Above

Capital Rental Whitefield City Electronic Marathahalli JP Nagar Yelahanka Hennur Silk Board Ramamurthy

* %change represents quarterly capital movement and yearly rental movement * Graph depicts the fluctuation in supply wrt demand for residential properties in various budget categories 99acres India’s No.1 Property Portal INSITE : BANGALORE 11

Annexures Annexures

CAPITAL VALUES RENTAL VALUES CAPITAL VALUES

Locality Jul-Sep 2018 Locality Jul-Sep 2018 Locality Jul-Sep 2018 Locality Jul-Sep 2018

Akshaya Nagar 4925 5600 Akshaya Nagar 14 Kalyan Nagar 18 5400 Jayanagar 10450 Arekere 16 16 6000 JP Nagar 5200 Banashankari 17 Kasavanhalli 19 5300 4625 Banaswadi 17 12 Bannerghatta 5825 Kaggadasapura 4250 Basavangudi 22 Kodihalli 20 Basavangudi 9800 Kasavanhalli 5050 Begur 15 Koramangala 26 Begur 4150 Kengeri 4075 Bellandur 21 KR Puram 15 Bellandur 6200 Koramangala 10000 16 Kumaraswami Layout 13 Benson Town 9575 KR Puram 4500 Bommasandra 12 20 Billekahalli 5000 Kudlu Gate 6300 20 Mahadevpura 20 Bommanahalli 4600 Kundalahalli 5500 BTM Layout 19 Malleshwaram 28 Bommasandra 2900 Mahadevpura 5775 23 Marathahalli 20 Brookefield 5800 Malleshwaram 11700 Cox Town 23 14 BTM Layout 5800 Marathahalli 6100 CV Raman Nagar 17 19 Budigere 4800 4400 27 Nagarbhavi 14 Cooke Town 8450 Nagavara 6500 Electronic City 15 Nagavara 15 CV Raman Nagar 5800 4900 Frazer Town 24 Panathur 21 Dodda Nekkundi 4225 Panathur 5800 Gottigere 12 Raja Rajeshwari Nagar 12 Doddathoguru 3700 Raja Rajeshwari Nagar 4600 HBR Layout 18 Rajaji Nagar 20 Electronic City 4450 Rajaji Nagar 12400 Hebbal 16 14 Frazer Town 9500 Ramamurthy Nagar 4100 Hennur 17 29 Gottigere 4175 RT Nagar 5400 Hoodi 19 RT Nagar 15 Gunjur 4200 Sahakara Nagar 5900 Agara 14 Sahakara Nagar 16 Harlur 5975 Sanjay Nagar 7100 Hormavu 16 Sarjapur 16 HBR Layout 5275 Singasandra 4250 HSR Layout 21 Singasandra 15 Hebbal 7475 Subramanyapura 4650 Hulimavu 15 Subramanyapura 13 Hegde Nagar 5500 TC Palaya 5600 Indira Nagar 25 TC Palaya 13 Hennur 5300 Thanisandra 5300 ITPL 20 Thanisandra 16 Hoodi 5800 Uttarahalli 4450 14 27 Horamavu Agara 4300 Varthur 4550 Jalahalli 15 Uttarahalli 13 Hormavu 4475 4400 Jayanagar 22 Vidyaranyapura 13 HSR Layout 5900 Vijayanagar 5850 JP Nagar 17 Vijayanagar 17 Hulimavu 5100 Whitefield 5675 Kadubeesanahalli 20 Whitefield 19 Indira Nagar 10000 Yelahanka 5175 Kadugodi 16 Yelahanka 14 Jakkur 5600 Yeshwanthpur 7500 Kaggadasapura 16 Yeshwanthpur 21

*All prices are per sq ft rates *Capital change depicts quarterly alterations in average ‘asks’ *Rental change depicts yearly alterations in average ‘asks’ *All prices are per sq ft rates *Capital change depicts quarterly alterations in average ‘asks’ *Rental change depicts yearly alterations in average ‘asks’ 99acres India’s No.1 Property Portal FIND BEST OPTIONS TO FIND BEST OPTIONS TO BUY SELL RENT PROPERTY buy, sell, rent property

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