BANGALORE: In a rising interest rate regime, where residential real estate is clearly feeling the heat, Bangalore as compared to other metros, is clocking in a fairly decent performance.
Bangalore residential sales volumes fell by a mere 7% y-o-y in Q3CY11 compared to the steep fall witnessed in the cities of Mumbai at 48% and Delhi at 31% due to healthy demand from the IT sector and only a modest (+7% y-o-y) increase in real estate prices, said a report by Prabhdas Lilladher, a brokerage firm.
The IT capital of India saw commercial realty absorption of 9mn sft in CY11, 28% jump as compared to last year. Rental also moved up by 10% across micro markets. "Commercial market is expected to continue to benefit from the relatively positive outlook in the IT/ITES sector," mentioned the report.
Some large realty companies such as Sobha Developers and Prestige Estates Projects, have been able to maintain sales volumes by starting H1 with a large quantum of launches.
Sobha clocked in sales of 2.77 mn in FY11, translating to Rs11.3bn in terms of value; this is likely to go up to 3.38 mn sft and Rs15.7bn, respectively in FY12. While, Prestige witnessed sales of 1.8 mn sft in volume terms and Rs13.8bn in value terms in FY11, which is likely to increase to 4 mn sft and Rs17.2bn, respectively in FY12.
"The strategy adopted by these companies is launching projects in attractive locations, focusing on the mid-income segment as well as expanding to newer cities," said the report.
Source: http://economictimes.indiatimes.com/markets/real-estate/bangalore-real-estate-market-plunges-by-7-in-q3-fy-2011/articleshow/11452960.cms
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