Mumbai Residential Marketbeat Q1 2021
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MA R K E T B E AT MUMBAI Residential Q1 2021 Resurgence of COVID affected residential launches in Q1 Mumbai’s residential sector witnessed launch of 10,742 units during the first quarter of 2021 with a marginal q-o-q drop of 6.5%. Developers launched fewer units in the current quarter on the back of resurgence of COVID and rising infection levels in the city. On a y-o-y basis, launches were down by 39.1%, which Q-O-Q DROP IN NEW LAUNCHES indicates that sustained recovery is still a few quarters away though residential sales have been improving gradually. Eastern Suburbs submarket witnessed 6.5% (Q1 2021) the maximum launches during the quarter with a share of 29% followed by Extended Eastern Suburbs and Western Suburbs with 26% and 21% shares, respectively. On a quarterly basis, while all these submarkets witnessed growth in new launches, few other submarkets like Thane, Navi Mumbai and Extended Western Suburbs saw perceptible drop in quarterly launches. Prominent developers like Godrej Properties, Runwal Group, Oberoi Realty and 57% SHARE OF MID SEGMENT IN Raymond Realty were the most active during the quarter and contributed nearly 47% of the total new launched units. Developers across all submarkets have UNIT LAUNCHES (Q1 2021) been focusing on the completion of ongoing projects but rising Covid cases and localized restrictions might impact construction timelines and further delay the handover of new homes by at least 3-6 months. SHARE OF EASTERN SUBURBS During the quarter, sales activity remained healthy as developers continued to offer various payment incentives to attract homebuyers along with the 29% IN UNIT LAUNCHES (Q1 2021) reduction in stamp duty that drove the housing demand. However, towards the end of the quarter, sales activity slowed down marginally, primarily due to the COVID resurgence across major suburban locations, which imposed a restriction on physical site visits by homebuyers. Mid segment continued to lead new launches The mid and affordable segments together accounted for nearly 84% of new launches in Q1 2021, with the mid segment contributing 57% and the affordable segment making up for the remaining 27%. The high-end segment witnessed the maximum q-o-q growth in percentage terms in Q1, mainly due to new MARKET INDICATORS OVERALL Q1 2021 projects launched by prominent developers in Eastern Suburbs and Western Suburbs. However, the affordable segment witnessed the maximum q-o-q drop in new launches due to the decline in project launches in the peripheral submarkets where rising unsold inventory remains a major challenge for developers. Y-O-Y 12-Months Extended Eastern Suburbs dominated the launch of affordable housing projects whereas, Eastern Suburbs, Thane and Western Suburbs led the way for mid Change Forecast segment launches. Going forward, we expect Western, Eastern suburbs and Thane to remain key markets for mid-segment projects, whereas Extended suburbs and Navi Mumbai will continue to dominate the affordable segment. New Launches The ready to move-in or nearing possession homes in the price bracket of INR 1.0-2.0 crore in Western Suburbs, Eastern Suburbs, Thane and Navi Mumbai submarkets continued to witness the maximum sales traction during the quarter. Sales of affordable housing projects in the Extended suburbs remained healthy as well. We expect a near term temporary slowdown in sales activity due to the evolving COVID crisis though residential sales is likely to pick up Units Sold momentum during the second half of the year. Capital values across submarkets remained stable in Q1 Average Capital The average quoted capital values across all submarkets continued to remain range-bound during the first quarter as compared to the previous quarter. Values (INR/sf) However, developers across segments and submarkets are selectively offering 5-10% discounts on quoted rates to serious home buyers along with other price incentives like zero stamp duty, cash discounts, zero floor rise, no PLC charges, and free gifts. While capital values for mid and affordable segments are expected to remain range-bound in the near future, we expect prices for high-end and luxury homes to witness a marginal drop during the upcoming quarters. Rental values also remained unchanged across all locations during the quarter. SIGNIFICANT PROJECT LAUNCHED IN Q1 2021 BUILDING LOCATION DEVELOPER UNITS LAUNCHED RATE**(INR/SF) Godrej Upvan Kalyan Godrej Properties 2,250 9,600 Runwal Centralis Sion Runwal Group 870 26,500 Ten X Habitat – Tower H & J Thane Raymond Realty 641 22,600 Godrej Urban Park Chandivali Godrej Properties 507 26,000 MA R K E T B E AT MUMBAI Residential Q1 2021 RENTAL VALUES AS OF Q1 2021* CAPITAL VALUES AS OF Q1 2021* AVERAGE AVERAGE QUOTED QoQ CHANGE YoY CHANGE SHORT TERM QoQ CHANGE YoY CHANGE SHORT TERM SUBMARKET QUOTED RENT SUBMARKET CAPITAL VALUES (%) (%) OUTLOOK (%) (%) OUTLOOK (INR/MONTH) (INR/SF) High-end segment High-end segment South 60,000 – 570,000 0.0% -18.6% South 40,000 – 78,000 0.0% -2.4% South Central 60,000 – 460,000 0.0% -16.4% South Central 22,000 – 68,500 0.0% -3.2% Eastern Suburbs 25,000 – 350,000 0.0% -12.5% Eastern Suburbs 12,000 – 37,500 0.0% 3.8% Western Suburbs – Prime 50,000 – 750,000 0.0% -6.3% Western Suburbs – Prime 24,000 – 60,000 0.0% -3.4% Mid segment Mid segment Eastern Suburbs 18,000 – 70,000 0.0% 0% Eastern Suburbs 10,000 – 23,000 0.0% -6.3% Western Suburbs 20,000 – 80,000 0.0% 0% Western Suburbs 9,000 – 25,000 0.0% -5.8% Thane 14,000 – 28,000 0.0% 0% Thane 7,000 – 13,000 0.0% -8.6% Navi Mumbai 10,000 – 50,000 0.0% 0% Navi Mumbai 5,000 – 14,000 0.0% -10.0% SIGNIFICANT PROJECT COMPLETED IN Q1 2021 BUILDING LOCATION DEVELOPER NO. OF UNITS UNIT SIZE (SF) Ketan Bhingarde Castle Rock (C&D Wing) Powai Hiranandani Developers 224 753 Manager, Research Services Dosti Desire – Pearl Thane Dosti Realty 270 518 - 783 +91 22 6771555 / [email protected] Ace Homes Thane Ace Realty 146 434 - 581 Kapil Kanala SIGNIFICANT PROJECTS UNDER CONSTRUCTION IN Q1 2021 Senior Associate Director, Research Services +91 40 40405555 / [email protected] BUILDING LOCATION DEVELOPER UNITS LAUNCHED EXPECTED COMPLETION Balaji Symphony – Phase 3 Panvel Vishesh Group 430 Q2 2021 Rivali Park Wintergreen Goregaon East CCI Projects 460 Q2 2021 Raheja Imperia Lower Parel K. Raheja Universal 250 Q3 2021 Data collated from primary and secondary resources. Estimations are subject to change * Rental and capital values have been depicted only for key submarkets and are based on saleable area. ** Quoted capital value of new launches is on carpet area based on agreement values which includes, Base Rate, Car Parking Charg es, Internal Development Charges, etc. cushmanwakefield.com The above values for high-end segment are for units typically of 1,200-3,000 sf The above values for mid segment are for units typically of 800-1,400 sf A CUSHMAN & WAKEFIELD RESEARCH PUBLICATION Affordable housing has been defined as units with a carpet area of 60 sq.mt in metros / 90 sq.mt in non-metros and value up to INR 45 lakh Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers and ow ners. Cushman & Wakefield is among the largest real estate services firms w ith KEY TO SUBMARKETS Mid Segment approximately 51,000 employees in 400 offices and 70 countries. In 2018, the High-end Segment Eastern Suburbs: Sion, Wadala, Kurla, Chembur, Ghatkopar, Vikhroli, Powai, Chandivali, firm had revenue of $8.2 billion across core services of property, facilities and South: Colaba, Cuffe Parade, Nariman Point, Churchgate, Altamount Road, Carmichael Kanjurmarg, Bhandup, Mulund project management, leasing, capital markets, valuation and other services. Road, Malabar Hill, Napeansea Road, Breach Candy, Pedder Road, Tardeo Western Suburbs: Andheri, Jogeshwari, Goregaon, JVLR, Malad, Kandivali, Borivali, Dahisar South Central: Worli, Prabhadevi, Lower Parel / Parel, Dadar, Matunga Thane: Thane, Ghodbunder Road ©2021 Cushman & Wakefield. All rights reserved. The information contained within this Eastern Suburbs: Wadala, Sion, Kurla, Chembur, Ghatkopar, Vikhroli, Powai, Chandivali report is gathered from multiple sources believed to be reliable. The information may Navi Mumbai: Airoli, Ghansoli, Rabale, Koparkhairane, Vashi, Turbhe, Sanpada, Nerul, Belapur, contain errors or omissions and is presented without any warranty or representations as Western Suburbs - Prime: Bandra, Khar, Santacruz, Juhu Kharghar, Panvel to its accuracy..