Commercial market saved the day

Vinod Behl

For the NCR realty, the pick up in supply — both in residential and office segments, rise of affordable housing  and buyers preference for ready-to-move-in properties marked the year 2018. In the residential segment, according to a Knight Frank study, though developers focused on projects completions, yet  new launches gained momentum with a growth of 90 per cent over the same period in 2017. Gurugram  contributed 47 per cent to the overall pie with launches in Sector 33, 106, 77 and 65. The new launches in Noida and Greater Noida happened in Greater Noida West and on Noida-Greater Noida eway.

Though prices remained muted in 2018, yet the sale pick up was not much. Luxury housing, particularly continued to face slowdown. Luxury homes of Rs 5 crore and more were particularly in low demand. According to industry statistics, this segment had staggering fall of 49 per cent.

 According to Anarock data, luxury homes unsold stock as on Q3 2018 in top 7 cities, including NCR accounted for 12 per cent of the total unsold stock.

 This and the overall residential -sale trend was largely due to the fact that in the backdrop of large number of stalled projects, RERA did not provide the anticipated relief to aggrieved home buyers in Haryana and Uttar Pradesh by way of  either refunding their money or the completion of stuck/delayed projects. Another factor responsible for not much rise  in sales was buyers refraining from buying under-construction properties due to development risks. In the light of this, the trend of ready-to-move homes was dominant during this year as buyers enjoyed the double advantage of safe investment and saving of 12 per cent GST on completed projects with completion/occupation certificate.

The year of budget housing

Affordability was the theme song of 2018. In fact, affordable and mid-segment turned out to be a saviour this year due to high interest subsidy on these segments under PMAY. Unsold inventory in NCR was brought down by 12 per cent in H1. Greater Noida and Gurugram account for about 63 per cent of the unsold inventory.

Office spaces on a high

Office realty which has been experiencing pan-India pick up for quite some time, registered about 3.6 msf of new supply as opposed to 1.8 msf in the same period in 2017. Gurugram witnessed large amount of fresh office supply in its key locations. The NCR market witnessed the  increasing trend of pre-commitment transactions, especially in the micro markets of Gurugram.It was not just supply, even leasing activity witnessed pick up. Steady leasing helped bring down vacancy levels in Gurugram’s key office locations of Golf Course Road and Golf Course Extension Road .

The growing trend of co-working spaces contributed significantly to leasing in Gurugram, Noida and Greater Noida. Gurugram outperformed other markets to take larger chunk of total transactions pie, registering 28% growth in first half of 2018.

In view of this rental values in Noida and Gurugram looked up. Quality office space  in micro markets of  DLF Cyber City and Golf Course Road, saw rental appreciation of 4-5 per cent.