By: Anuj Puri, Chairman – ANAROCK Property Consultants
Indians looking to buy homes in 2019 have a very compelling rationale to opt for ready-to-move (RTM) homes, which – apart from being exempt of the 12% GST ambit – are available plentifully.
As per ANAROCK data, out of the total 6.73 lakh units of unsold housing inventory, nearly 85,000 units are currently ready-to-move-in across the top 7 cities. Interestingly, out of these total unsold ready-to-move options, nearly 60% of units are in the affordable and mid segments priced below Rs. 80 lakh.
RTM quotient of Unsold Stock
Source: ANAROCK Research (RTM= Ready-to-move-in)
Currently, the bulk of end-user, as well as investor demand, now skewed heavily towards affordable and mid-segment properties in this price bracket. In fact, ANAROCK’s consumer sentiment survey H2 2018 also revealed that nearly 67% aspiring homebuyers preferred to buy properties within this budget range.
This is not surprising, as most of these properties indeed offer a good value proposition with the least amount of risk. However, the caveat that a ready-to-move-in property must have the benefit of a completion certificate to benefit from 12% GST exemption must be borne in mind.
The previously significant price difference between ready-to-move-in and under-construction properties is narrowing down because of the massive unsold stock in most cities. However, the additional GST charge on under-construction options is impossible to ignore. In other words, the fact that of such a massive supply of RTM options on the market makes most buyers’ preference a bit of a no-brainer
On taking a closer look at the data, it emerges that NCR and MMR are the cities with maximum unsold ready-to-move stock. Together, they account for nearly 54% of such stock in the top 7 cities. Hyderabad has the least amount of ready-to-move stock with just over 4,400 units.
In terms of budget segmentation too, MMR and NCR have the maximum available ready-to-move stock in the affordable and mid segments (below Rs. 80 lakhs) – together accounting for 55% of the stock in the main 7 cities. Pune has an equal mix of ready-to-move properties priced below Rs 80 lakhs and properties priced above this budget range.
All other cities have fewer ready-to-move options in the luxury and ultra-luxury categories than NCR, which again tops the list on this front.
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