Realty wakes up from slumber in Kochi, makes modest recovery

The Cochin Chamber of Commerce and Industry (CCCI) carried out the research among 66 Credai members and 65 non-Credai members in Kochi and Aluva.

  • Published On Jun 22, 2016 at 01:30 PM IST

KOCHI: After almost two years of sluggishness, the city's realty market is showing signs of recovery, reveals a study sponsored by the Kochi chapter of Confederation of Real Estate Developers' Associations of India (Credai).

According to the latest study, titled 'Data Research and Analysis of Real Estate Sector in Kochi-Phase 4', there is faster absorption of ready-to-occupy category in the market.

The Cochin Chamber of Commerce and Industry (CCCI) carried out the research among 66 Credai members and 65 non-Credai members in Kochi and Aluva.

The study looked at the stock position of 70 completed projects and 146 ongoing projects with about 17,377 units. Of this, 4,557 units were unsold as on March 31, 2016.

Compared to the previous Credai study, which looked at the stock position on August 31, 2015, the unsold stock has come down in the two real estate hotspots of the city - northeast Kochi and south Kochi. The unsold stock in northeast Kochi came down from 2,133 units in August 2015 to 1,902 units in March 2016. This area comprises Kakkanad, Thrikkakkara, Vazhakkala, Pallikara, Kizhakkambalam, Padamugal, Vennala and Chakkaraparambu.

Similarly, the unsold stock in south Kochi, spread over Maradu, Kundannoor, Panangadu and Aroor, came down from 411 units in August 2015 to 311 units in March 2016.

"In the last one year, there has been reasonable improvement in demand and faster completion of projects compared to the previous two years. The two studies done over the last one year shows that demand has improved for apartments in the range between Rs 40 lakh and Rs 1.2 crore. The latest study (March 2016) shows that there is a faster absorption of ready-to-occupy stock than the previous period, covered in the August 2015 study," said Najeeb Zackeria, secretary general of Credai, Kerala.

The total market value of 4,557 unsold apartments in Kochi is Rs 3,943.80 crore, with 3 BHK flats accounting for Rs 2,497.90 crore. The market value of other unsold units are: 1 BHK (Rs 69.97 crore), 2 BHK (Rs 710.31 crore), 4 BHK (Rs 558.99 crore), 5 BHK (Rs 104 crore) and duplex (Rs 2.6 crore).

According to the study, the current absorption rate is 150 units per month in the Kochi market. "There has been an increase in the offtake of home loans with the reduction of interest rates. The 2 BHK and 3 BHK categories, which are much in demand, have reported the maximum sales," Zackeria observed.

The Fire and Rescue Services Department's insistence on builders following the National Building Code had negatively affected real estate projects, the study said.

"The enormous delay in statutory approvals (from six months to nearly two years), especially in sanctioning fire NOC, has significantly affected the launch of new projects. Only 37 new projects could be launched in the six months period from September 2015 to March 2016," the study observed.

  • Published On Jun 22, 2016 at 01:30 PM IST
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