FOREWORD It’s a new calendar year and Magicbricks wishes all its readers a Very Happy 2015. It’s been a year where subdued sentiments in the property markets gave rise to euphoria over Prime Minister Modi’s conclusive win in the General Elections and then settled into a subdued mode again. In its 15th edition, PropIndex reflected the reality of the real estate market in India which clearly gave a green signal for affordability and value for money. This was in line with the government’s agenda of promoting ‘Housing for All by 2022’. City indices remained fairly stable. Riding high on the ‘Modi’ factor Ahmedabad recorded the highest rise of 3 per cent in the City Index values. The Delhi City Index continued to drop (1%) indicating slow uptake in the market. At the macro level, properties in the affordable or mid-segment ranges were clearly a popular choice. The budget range of Rs 20-40 lakh saw a rise across cities except in Delhi, Gurgaon and Kolkata. In line with this trend, the 1BHK category saw a rise in demand across all cities. Delhi and Gurgaon saw a rise in demand for 2BHK units as well. As the capital markets regained momentum post the formation of the new government at the Centre, rental markets were subdued in the Oct-Dec 2014 quarter. Almost 40-50 per cent of the tracked localities in each city recorded a drop in values. After a dull year, 2015 is expected to bring with it new and positive changes in the sector. The year is going to be crucial as this is the time when the Government’s promises would actually be put into practice. Do write in at [email protected] and share yours views on this report and how we could make PropIndex even better. You may also share your opinion with #PropIndex on our Twitter handle @magicbricks or connect with us on Facebook at www.facebook.com/magicbricksTOI. Sudhir Pai Business Head, Magicbricks.com METHODOLOGY Magicbricks PropIndex are aggregated into their been chosen based on respective cities and their activity levels) and Magicbricks PropIndex then to the National has an individual city is a tool which Index. Weightages for report for each of these empowers property PropIndex are based on cities. While the NPI and seekers and investors the supply of properties its movements are of with detailed within the locality/city. interest to the expert information on the Based on this structure, community of bankers, movement of residential PropIndex gives a builders and investors, apartment prices and realistic picture of the PropIndex has also supply of properties in trends in price/supply taken care to explain the India. No credible across different property nuances of index property index can be a markets in each city. We movements at the function of direct values have used different locality level that would as the changes are weightages for Listed help the huge base of governed by multiple Price Monitor/Rent Magicbricks.com factors. Monitor. Therefore, read consumers. as a whole, PropIndex Magicbricks PropIndex Insights into consumer along with tables has taken this reality demand have been provided for Listed Price into account and gathered through Monitor, Rent Monitor, produced an index based analysis of search Yield Monitor and on listing of apartments information on the site. Capital Values, gives an and their capital and This helps understand excellent perspective of rental values on the the best localities by the property market website. demand, the type and performance in the configuration of units as Magicbricks has over quarter. 700,000 active properties well as the budget-wise posted by more than While listing and its preferences. values/supply provide a 1,40,000 active users in The PropIndex is the level of understanding 300 cities and 10,000 result of meticulous of the market, there are localities. Our users research at the locality meticulous data checks include owners, agents level and through to prevent aberrations and developers. detailed discussions creeping in the Index. with experts at These are based on Magicbricks.com’s Methodology statistical calculations, offline and online industry inputs and Apartment values are initiatives. based on listings on logical interpretations. The Indian real estate Magicbricks. These The National Property market is dynamic and include multi-storey Index (NPI) is indicative the PropIndex reflects apartments and single of the extent of activity those changes. Since it is units on plotted as well as price derived from a dynamic developments, referred movements across cities database, additions and to as builder floors on and localities in the deletions of localities Magicbricks.com. major cities active on happen as a function of Magicbricks.com. The The Index is structured market dynamics. in such a way that index includes the top individual properties 11 cities (these have GLOSSARY & DEFINITIONS There is a wealth of information within these pages. For better readability, we have presented some data as tables and others as graphs. Between them, you will find how property markets have performed in the Oct-Dec 2014 quarter from different perspectives – from that of capital appreciation, from a rental/yield realisation perspective and from a supply standpoint. Demand Analysis section also explains what consumers look for. We recommend that you evaluate the city report in its entirety and that will provide a rounded perspective of the performance of the property market within each city. Here are the details of what you will find in each of the city reports enclosed within: 1. City Property Index – This is a composite index which is a function of supply of properties as well as the average capital appreciation/drop in various localities of the city in the quarter. The city index is the weighted average of the average rate per square foot in that locality and the supply of properties from that locality. Premium localities (with higher average rate per square foot) as well as localities with higher supply of properties will have a bigger impact on the Index. For example, if the supply of properties from a premium locality drops, that locality will end up having a lower weightage in the index which in turn will push the Index downwards (and vice-versa). On the other hand, supply of properties remaining unchanged, the Index will be influenced by capital appreciation within the locality. 2. Listed Price Monitor – This metric shows the capital appreciation/drop within a locality and is calculated on the basis of movement in the “average rate per square foot” within that locality. By and large, the movement in the “average rate per square foot” reflects capital appreciation/drop. However, in a few select cases, we have observed that the average rate per square foot moves due to a change in the mix of apartments within that locality (e.g. if the ratio of premium apartments, which command a higher per square foot rate, changes over the quarter). In these few circumstances, the Listed Price Monitor will, in turn, reflect this input. Such changes have been explained in the text of the City Reports. 3. Rent Monitor – This reflects the rental appreciation/drop within a locality. It is calculated on the basis of movement in the “average rent per square foot” within that locality. By and large, the movement in the “average rent per square foot” reflects rental appreciation/drop. However, in a few select cases, we have observed that the average rent per square foot moves due to a change in the mix of apartments within that locality (e.g. if the ratio of premium apartments, which command a higher per square foot rent, changes over the quarter). In these few circumstances, the Rent Monitor will, in turn, reflect this input. Such changes have been explained in the text of the City Reports. 4. Yield Meter – Yield is the annual rate of return earned on property. The Yield Meter depicts the gross yield percentages across various localities. Gross yield is a ratio of average annual rental value to the average capital value of the property. 5. Capital Value Tables (given in Annexures) – This shows the actual range of prices within which properties were available in each locality in the quarter. Prices are shown in Rupees per square foot basis, these are the prevailing rates for properties in each locality. 6. Demand Analysis – This analysis of consumer demand is based on searches and requirements that users have performed on Magicbricks.com. The top localities by demand gives an insight into consumer peferences. The demand data has been used to arrive at various aspects of consumer requirements including Budget-wise analysis, Property type analysis and BHK configuration analysis. This section also provides a comparison between demand and supply in the Jul-Sep and Oct-Dec 2014 quarters. 7. Editorial Speak – PropIndex has gone from strength to strength – adding more analytics, insights and diverse views in every edition. To enhance the insights provided by our data PropIndex now includes city perspectives from editors of Times Property. NOTES VOL 4, ISSUE 3; OCT-DEC, FY 2014-15 propindex.magicbricks.com NATIONAL PROPERTY INDEX (NPI) OCT-DEC 2014 n Small size units recorded a rise in demand by 1-4 per cent, across India n Properties worth Rs 20-50 lakh went up by 3 per cent n NCR witnessed a Source:Magicbricks.com drop in supply of OCT-DEC 2014 segment (Rs 1 crore and Above) premium noted a drop of 1-2 per cent. properties by 3-10 In the Oct-Dec 2014 quarter, the National Property Index (NPI) Overall, active supply remained per cent except rose by 1 per cent over the passive and recorded a nominal Ghaziabad, previous quarter.