Chennai - India Real Estate Outlook Report
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Chennai July – Dec 2014
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Transcript of Chennai - India Real Estate Outlook Report
Chennai July – Dec 2014
Residential July – Dec 2014
2014 witnesses a sharp drop in demand for residential properties
RESIDENTIAL
Chennai residential market launches, absorption and price trend
LAUNCHES ABSORPTION WT. AVG. PRICE (RHS)
4% rise in price Y-O-Y in 2014
2% rise in H2 2014 vs. H2 2013 H2 2013 – 10,421 units H2 2014 – 10,643 units
9% fall in H2 2014 vs. H2 2013 H2 2013 – 8,015 units H2 2014 – 7,320 units
RESIDENTIAL
Residential Market in Chennai in Year 2014
Sales volume
fell by
14%
20,960 units sold vs. 24,444 units in 2013
New launches dropped
by 25%
24,850 units launched vs. 18,700 units in 2013
In the overall share, North and Central witness a significant jump while West stays steady
RESIDENTIAL
3,16
2 un
its
3,19
5 un
its
3,66
1 un
its 16
5 un
its
357
units
1,62
0 un
its
3,54
5 un
its
275
units
757
units
7,84
0 un
its
1,74
6 un
its
19 u
nits
A moderate 4% hike in prices have continued the momentum in sales during Jul – Dec 2014
RESIDENTIAL
397
units
312
units
610
units
2,46
3 un
its
3,89
5 un
its
2,69
3 un
its 31
6 un
its
259
units
306
units
6,73
5 un
its
6,94
8 un
its
8,99
0 un
its
Chennai to take little less than 2 years to exhaust the existing inventory
RESIDENTIAL
West Chennai - One of the best performing areas with low prices and proximity to employment hubs
RESIDENTIAL
Total Unsold Units 47,140
as on December 2014
Central
West South North
At 5%, Alandur has witnessed the highest price rise in the last 12 months – Upcoming Metro the driver
RESIDENTIAL
Concluding Remarks
Chennai Residential market on the slow track - Absorption drops 14%
Moulivakkam building crash makes further dents; launches drop by
25% in 2014 Prices increased by 4% Y-O-Y during H2 2014
RESIDENTIAL
Going forward
Launches are expected to fall by 20% in the Jan – Jun 2015 period Sales to remain relatively steady at 11,360 units during Jan – June
2015; registering a growth of 10% on a Y-O-Y basis Price is expected to increase by 4% during Jan – Jun 2015 RBI policy rate cut infuses hope among city home buyers – Are
better days expected?
RESIDENTIAL
Office July – Dec 2014
Office vacancy levels have fallen drastically owing to robust leasing activity in 2014
OFFICE
23% 24% 23% 21% 19% 16% 24%
New supply fell by 57%, absorption registered a 7% growth Y-O-Y
OFFICE
IT / ITeS continues its steady run while Manufacturing drops from its peak
OFFICE
y
Among all other business districts, SBD led the city in terms of absorption
OFFICE
y
231,
350
sq.ft
.
285,
000
sq.ft
.
200,
000
sq.ft
.
317,
500
sq.ft
.
72,0
00 s
q.ft.
93,3
00 s
q.ft.
1,57
2,00
0 sq
.ft.
479,
500
sq.ft
.
291,
411
sq.ft
.
731,
500
sq.ft
.
Rental movements to grow by 3% in the next 6 months
OFFICE
y
Concluding Remarks
• City office market on a healthy diet; posts a 7% rise in absorption in 2014
• Chennai realtors bet big as vacancy levels see a significant drop
• Chennai maintains a steady run-rate - Will it continue the hold over absorption?
Going Forward
• Chennai is likely to witness a restricted supply of new office space during Jan – Jun 2015; a 5% decline on a Q-O-Q basis
• Absorption likely to be 2 mn.sq.ft. during Jan – Jun 2015;
slightly better than that of H1 2014 • Weighted average rental to rise by a nominal 3% on a Y-O-Y
basis
