New Delhi: While the government is excited with the latest 7.4% GDP growth rate, real state sector seems to be going back with decline in its growth. According to a report released by Cushman & Wakefield, the number of new residential projects this year saw a steep decline of 12 percent. Across eight major cities, in 2014, only 1,53,000 units were launched in comparison to 1,74,400 units in 2013.
The biggest decline was witnessed by Hyderabad and Delhi/NCR with 46% and 30% fall respectively. However, Kolkata and Chennai saw a rise in the number of launches against the trend.
Out of 1,53,000 launched in 2014, about 92,700 were launched in Bangalore, Delhi/NCR and Mumbai collectively, amounting 60% of the total.
Mid segment saw most of the activity with two thirds of the launches of all eight markets falling into the segment. Mid segment market saw a rise of 5% over the previous year in the same segment. Affordable and high-end segment witnessed the biggest fall by 38% and 29% respectively. The luxury segment saw a rise of 400%, from 200 units in 2013 to 1,000 in 2014.
The response in the first half of 2015 is expected to be quite but the C&W report says that the steps taken by the government and regulatory authorities will bring a positive change.
Sanjay Dutt, executive MD, South Asia, C&W, says that interest rate reduction by RBI, tax rebate incentives in the budget, boost in savings will increase the demand. Faster approvals of the projects, financial support and incentives by the government could also boost the number of projects.
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