Luxury Housing Still In ICU, Unsold Stock Rises 10%

Even as they sold like hot cakes a few years back, luxury housing sales are now in the doldrums and hinging largely on end-user sales. Even after three years of demonetisation, the luxury segment remains the worst-performing of all budget categories having the lowest share of overall unsold stock in the top seven cities, according to a report by Anarock Property Consultants.

According to the market analysis by Anarock, unsold stock in the luxury segment priced above Rs 1.5 crore increased by 10 per cent y-o-y by 2019-end with 89,200 units remaining unsold as against 81,290 units in 2018. Overall value of unsold luxury stock as on 2019-end is estimated to be nearly Rs 1.59 lakh crore, which is 34 per cent of the total unsold stock value.

As per the Anarock data, the overall unsold housing stock across different budget segments stood at 6.48 lakh units worth Rs 4.64 lakh crore, declining by mere 4 per cent since 2018.

“On breaking down the unsold stock at the two extreme ends of the budget spectrum, it emerges that affordable homes comprised the maximum share at 36 per cent while luxury homes had the least, with less than 14 per cent share. Luxury developers have severely curtailed the supply pipeline, primarily due to the absence of investors in this segment,” said Anuj Puri, Chairman, Anarock Property Consultants.

The data showed that mid-segment homes priced between Rs 40-80 lakh shed the maximum unsold stock in 2019 by 15 per cent - from nearly 2.27 lakh units in 2018 to around 2.02 lakh units in 2019-end.

In terms of cities, Hyderabad and Pune saw unsold luxury stock increase by a whopping 58 per cent and 56 per cent respectively during the period. In Chennai, unsold luxury stock increased by 33 per cent.

Delhi-NCR saw its unsold luxury stock increase by 17 per cent in the period. The unsold luxury stock here was the second-highest after Mumbai Metropolitan Region (MMR) with around 18,400 units by 2019-end. Bangalore’s unsold luxury stock also increased by 6 per cent.

Kolkata, in sharp contrast to other cities, saw a 10 per cent decline in its unsold luxury stock. Mumbai also did reasonably well despite adding almost 11,250 luxury units in 2019 as the region saw a mere 2 per cent y-o-y increase in unsold luxury stock.