Chennai housing market reports 57% fall in launches

Chennai witnessed launch of 3,200 new residential units during the first quarter of 2015, which is a 57 per cent decline from the same period last year. Residential sales in the city accounted for 13 per cent of the total launches across eight top metros during the quarter, according to real estate consultant Cushman & Wakefield.

The report, however, stated Q1 residential sales were nearly twice that of the previous quarter. Most developers had launched their new projects during the Pongal festival in January and the recently concluded property fair in February, the report stated.

Mid-segment unit offerings constituted 96 per cent of total launches during the period under consideration. A majority of high-end segment launches were concentrated in Off Central-I and Nungambakkam submarkets.

The Suburban (south) and Grand Southern Trunk (GST) Road comprised nearly 37 per cent and 26 per cent, respectively, of the total launches.

Quoted capital values appreciated in select sub markets, said the report, adding the availability of quality mid-segment offerings stimulated demand in Porur and Rajiv Gandhi Salai-I and thereby increasing the quoted capital values by 5-6 per cent from the previous quarter.

During the period, nearly 2,600 units became available for possession, which is three per cent higher as against the previous quarter. Mid-segment accounted for 77 per cent of the total completed units, followed by high-end segment at 22 per cent.

On the outlook, the real estate research firm said the quoted capital and rental values may remain stable. With the recent reduction in interest rates, demand may improve in the future period, it said.

It expects launches may stay at similar levels in the next quarter. According to it, with a near 4,300 units currently in the pre-launch stages, new launches are likely to remain stable as developers were focused on completing all under-construction units.