Quantification of Realty Stress 90000 Crores PropEquity

Quantification of Realty Stress 90000 Crores PropEquity

On 25 Dec , 2019 11:35 PM

Quantification of Realty Stress – 90,000 Crores-- PropEquity

New Delhi, September 17, 2019: The setting up of a stress fund of Rs. 20,000 crore for completion of stalled projects by the government is going to lend the much needed relief to the distressed housing sector. This move is to revive stalled projects in the affordable and middle income housing category. This special window will provide last mile funding for housing projects which are non-NPA and non-NCLT projects and will focus on unfinished projects. This step is a very positive move in the direction of reviving the real estate sector bythe government.

It is also important to point out that the government really had no role to play in the creation of the current crisis. It addition the impact of the GST and demonetisationon the stressed projects discussed in this release was minimal as these project were in the affordable and mid category and thus cashless as they required maximum housing finance. The government also reduced the GST last year to provide relief to the developers and to the sector. In fact the current crisis has been a consequence of key causes such aslack of execution capability of developers, oversupply of inventory, excessive land banking, lack of understanding of the demand supply dynamics, unjustified price appreciation, lack of social and physical infrastructure in emerging markets. The crisis today has further escalated due to the current NBFC crisis.

Under Construction Projects to be completed in the next 2 years

Tier

No of Builders

No of Projects

No of Units

Percentage

Tier-1

               2,919

               3,891

         799,039

85%

Tier-2

                  590

                  697

         135,843

15%

Grand Total

              3,509

              4,588

        934,882

 

 

 

City

 No of Builders

 No of Projects

 No of Units

Percentage

MMR

                  988

               1,258

         200,299

21%

NCR

                  258

                  409

         222,660

24%

Chennai

                  113

                  181

           35,798

4%

Pune

                  617

                  800

         111,019

12%

Hyderabad

                  184

                  215

           37,642

4%

Bengaluru

                  345

                  431

           72,723

8%

Kolkata

                  177

                  275

           67,290

7%

Ahmedabad

                  285

                  322

           51,608

6%

Tier 2 Cities (28)

                  590

                  697

         135,843

15%

Total

              3,557

              4,588

        934,882

 

1. Projects to be completed by Dec 2021, i.e. within 2 year

2. Only Apartments, Ind Floors, and Villas are considered

3. Hold projects details provided separately

4. Current price of the projects <= MMR <= 7500, Gurgaon<=6000, Ahmedabad <=4000 and remaining Tier-1 cities 5000 and remaining tier-2 cities <= 3000 psqft considered

5. Tier-1 - Ahmedabad, Navi Mumbai, Bengaluru, Kolkata,Chennai,Faridabad,Ghaziabad,Greater Noida,Gurugram,Hyderabad,Mumbai,New Delhi,Noida,Pune,Thane

Tier-2 - Agra,Amritsar,Vadodara,Nashik,Bhopal,Coimbatore,Dehradun,Gandhinagar,Chandigarh,Bhiwadi,Bhubaneshwar,Vijayawada,Indore,Jaipur,Kochi,Ludhiana,Mangalore,Mohali,Mysore,Nagpur,Goa,Panipat,Raipur,Sonepat,Surat,Trivandrum,Lucknow,Guntur,Visakhapatnam

6. All Prices & Sizes are considered on Super Area" 

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