77 per cent increase in residential supply in Chennai last year, says report

The report by Anarock states that Chennai led with a significant 98pc increase in the new launch supply among the southern cities.

Published: 12th February 2019 04:24 PM  |   Last Updated: 12th February 2019 04:24 PM   |  A+A-


Image for representational purpose only.

By Express News Service

CHENNAI: Chennai tops the three main southern cities which collectively witnessed a whopping 77 per cent increase in new residential supply in 2018 over the previous year – from approximately 38,330 units in 2017 to 67,850 units in 2018, according to Anarock, one of leading independent real estate services company

According to a report by Santhosh Kumar, vice-chairman, Anarock Property Consultants, although the liquidity crunch and stalled or delayed projects continue to plague the sector, the main southern cities of Bangalore, Chennai and Hyderabad actually saw faster growth momentum than their northern counterpart National Capital Region.

The report by Anarock states that Chennai led with a significant 98pc increase in the new launch supply among the southern cities. Bangalore followed with a 91pc jump, while Hyderabad witnessed a rise of about 43pc in new housing stock.

Even on the sales front, the main southern cities collectively overtook their northern and western counterparts. They saw a 20pc increase in housing sales as against 18pc rise in the North and 15pc in the West, the report stated.

The collective unsold stock in these southern cities is a mere 19pc of the total 6.73 lakh unsold units across the top seven cities. NCR alone has nearly 28pc of the total unsold stock.

Retail, commercial and residential real estate saw a lot more activity in Southern cities than in the North.

The statistics clearly indicates that the housing markets in the southern cities are exceptionally resilient, and were quick to recover from the overall slowdown in the Indian real estate sector.

The fact that these cities are driven by demand from the IT/ITeS sector definitely played a role. However, more pertinently, these are largely end-user driven markets, unlike cities in the north that were driven by speculators.

As per ANAROCK data, the main southern cities saw collective office space absorption of nearly 21 million sq. ft. as against just 6 million sq. ft. in entire NCR. In terms of new supply too, the southern cities raced ahead with nearly 14.7 million sq. ft. of Grade A office space getting deployed there in 2018.

Fresh supply of malls across the top seven cities was limited in 2018. However, the further liberalization of FDI policies repositioned Indian retail on the global investment map and attracted a large number of global retailers into the country.

ANAROCK data indicates that the three primary southern cities together accounted for more than 90pc of the overall new mall supply in 2018, leaving their western and northern counterparts far behind. Among the southern cities, Hyderabad led in terms of new mall supply, followed by Chennai and Bangalore.

All in all, the southern cities had a very clear edge across sectors in real estate activity in 2018. Their inherent advantage stems from the more professional and organized approach to real estate - not just post Real Estate Regulatory Act (RERA) implementation but also in the pre-RERA years, the report added.

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