Magicbricks ProIndex 2018 reports key insights in price stability/increase
There was finally some silver lining for India’s real estate industry as 66% of the 750 major localities in India witnessed price stability/increase between Jan-Mar 2017 and Jan-Mar 2018 but a cause of concern remains in the remaining 34% where prices declined during the same period, reports the latest Magicbricks’ PropIndex (JFM, 2018).
The latest PropIndex compares the price movement in these 750 localities over a 12-month period; first between Jan-Mar 2016 and Jan-Mar 2017 and then, between Jan-Mar 2017 and Jan-Mar 2018. The objective was to assess what percentage of localities continue to witness price decline and present the extent of price related stress in the market.
And the key insights have been interesting and would surely be a shot in the arm for the industry. The PropIndex revealed that number of localities which continue to witness price decline has gone down. Compared to 34% localities with price decline between Jan-Mar 2017 and Jan-Mar 2018, 56% localities saw price decline between Jan-Mar 2016 and Jan-Mar 2017. Therefore, number of localities which continue to witness price decline has gone down by 39%. So, while the market overall continues to remain under stress, there is some amount of recovery happening.
With 78% less localities witnessing price decline between Jan-Mar 2017 and Jan-Mar 2018 as compared to Jan-Mar 2016 and Jan-Mar 2017, Thane ranks first amongst 14 cities considered in this study. It is followed by Ahmedabad (-75%) and Greater Noida (-50%).
In terms of region, West India seems to be recovering the fastest. The region had 60% lesser localities with price decline. This was followed by North India (31%) and South India (25%). Kolkata in the east had 24% lesser localities with price decline. However, in case of West and North India, it must be remembered that these geographies had seen price decline across a large number of localities and there is a base-effect in play here.
Commenting on the key insights of the PropIndex, Sudhir Pai, CEO, Magicbricks, said: “As we look forward to what would be a good year for the industry, I am happy to share the Magicbricks PropIndex for Jan-March 2017-18 edition. The good news is that the National Price Index continues to move up, though marginally, for the third straight quarter. It was also heartening to see that in the crucial Rs.3,000-7,000 per sq.ft price bracket, which accounts for more than half of consumer preference and property listings, percentage of localities with price decline decreased to 31% during 2017-2018 from 53% levels during 2016-17.”
PropIndex also highlights that among the localities that witnessed price decline between Jan-Mar 2017 and Jan-Mar 2018, around 48% are in the National Capital Region (NCR) residential market. West India comprising Mumbai Metropolitan Region (MMR), Pune and Ahmedabad comes second with 31% share of these localities. South India cities of Bangalore, Chennai and Hyderabad together account for only 10% of such localities.
Hyderabad (6%) is the best performing city when it comes to cities with least number of localities with price decline over last 12 month period. Navi Mumbai (20%) and Bangalore (28%) are second and third.