Delays in residential real estate projects is not a pan-India phenomenon but limited to major metropolitan cities of Delhi NCR and Mumbai which account for 84 percent of the total project delays in the upper-mid and premium categories, says a new report.
In monetary terms, the delayed/stalled projects stand at a whopping Rs 4.62 lakh crore and Delhi NCR and Mumbai again account for nearly 90 percent of this value, says the report.
JLL Research’s data indicates that the total number of residential units classified as delayed or stalled in the top seven cites stands at 4.54 lakh. However, 84 per cent of these units are present in two major metro cities of Delhi NCR (62%) and Mumbai (22%). The percentage share of rest of the cities is in single digit.
The delay in project completion is concentrated in Delhi-NCR and Mumbai and is not a trend across all the top seven cities. In Delhi, around 3/4th of the residential units are delayed or stalled and one out of every three residential units in Mumbai falls in the same category.
The slowdown in completion of projects is not across the entire spectrum of housing categories but significantly visible in upper-mid and premium categories. What is needed is perhaps a push from the government and funding agencies along with a strict code of conduct among developers which will improve the situation, the report said.
The delay is not endemic across all categories of residential projects. Houses priced up to Rs 75 lakh are categorised as affordable and mid segment except for Mumbai where the threshold of affordable and mid segment in Mumbai is Rs 1 crore. The average price of delayed residential units stands at Rs 1.99 crore for Mumbai as compared to Rs 95 lakh in Bengaluru, Rs 94 lakh in Hyderabad and Rs 87 lakh in Chennai.
Although it is the affordable and mid segment categories which form a substantial proportion of the residential sector activity, they do not account for much of the delayed projects except in select cities like Kolkata and Pune, it said.
Residential projects launched on or before 2014 and still ‘under-construction’ have been referred to as delayed or stalled projects.
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