A dip in the number of new launches in Kolkata’s residential market last fiscal has has not affected demand for the affordable and mid-segment housing here.
Maintaining its positive outlook for Kolkata’s residential market for the coming quarters of 2012-13, real estate advisory firm Knight Frank has maintained that prices are expected to remain stable with demand being truncated because of cautious consumer sentiments.
According to its report – “September 2012 Residential Traction at a Glance” – till July this year, there was 61 per cent absorption in the affordable and mid-segment homes with ticket sizes less than Rs 50 lakh.
As of June, nearly 42,000 residential units are under construction in the city and its surrounding areas, out of which nearly 8,000 units are slated for completion by the end of this calendar year, it maintained.
Despite a dip in project launches in 2011-12, the Kolkata residential market has, however, seen “encouraging demand” in the first few months of the current fiscal.
Launches in previous fiscal dipped to 5,800 units compared to the 11,000 in 2010-11. According to the report, the absorption of residential units stood at around 14,500 last fiscal.
After slow absorption in the first two quarters, demand picked up in the third (Q3) and fourth quarters (Q4) of the fiscal. With residential demand picking up in the second half of last fiscal, the absorption rate in Q1 FY 13 has been encouraging, the report stated.
Good demand in the affordable and mid-segment housing, however, has failed to provide cheer for the high-end segment (homes costing between Rs 50 lakh and Rs 75 lakh).
The residential market of Kolkata has 14,300 unsold units, according to the report, out of which nearly 37 per cent is contributed by Rajarhat (on the eastern fringes of the city), followed by South Kolkata contributing about 34 per cent of the unsold inventory.
The report on a micro-market level maintains that West Kolkata – areas along the Kona Expressway – is the worst performer.
According to Knight Frank’s report, nearly 48 per cent of the total units under construction in these areas are still vacant.