Mumbai, 6th September 2023: One of the primary aims of the Real Estate Regulatory Act (RERA) was, and continues to be, safeguarding homebuyers from the harrowing issue of delayed and stalled housing projects. To a large extent, this objective is being achieved. Latest ANAROCK Research data finds that at least 86% of residential projects launched in the post-RERA period from H2 2017 and entire 2018 are completed.
(Only H2 2017 & 2018 projects have been considered because on an average, it does not take more than 5 years to complete most housing projects, with the exception of large townships).
Out of a total of 1,642 RERA-registered residential projects launched in the top 7 cities in these 1.5 years, at least 1,409 are completed despite major headwinds like Covid-19 and the supply chain disruptions of the war in Europe. With 90%, Chennai saw the highest number of project completions among the top 7 cities. Out of 119 projects launched in the city in between H2 2017 and the whole of 2018, over 107 are complete as on date.
|Housing Project Completion Trends in Top 7 Cities|
|City||Total Projects Launched in H2 2017 & 2018||Total Housing Projects Completed as on date||% Share Completed|
Source: ANAROCK Research
Anuj Puri, Chairman – ANAROCK Group, says, “When it comes to ensuring timely delivery of residential real estate projects, RERA has delivered resoundingly wherever it has been fully deployed. The overall completion rate of 86% across the top 7 cities in the 1.5 following RERA implementation is remarkable, especially considering the market circumstances prior to its deployment.”
Notably, these project completions took place during a period when construction activity was severely impacted by the pandemic-induced lockdowns. From H2 2017 onward, a ‘delivery at all cost’ approach has taken firm root, predictably spearheaded by the country’s leading developers. More than 4.02 lakh homes were completed in 2022 across the top 7 cities – the highest yearly completions since 2017.
“While Chennai recorded the highest number of project completions at 90%, Kolkata saw the least at 70%,” says Puri. “Currently, Chennai has the least available stock across the top 7 cities with approx. 28,300 units available for sale. Kolkata has, in all likelihood, trailed behind because RERA was not implemented in the state until late 2022. Moreover, when compared to the other major cities, real estate activity in Kolkata has remained relatively subdued.
Projects that remain incomplete across cities for various reasons. In some cases, there are large-size projects which take longer to complete while in others, projects by smaller developers have been roadblocked by liquidity and/or regulatory compliance issues. Amid soaring inflation of input costs, only financially strong developers are able to keep their projects on track. Progress on many projects has also been held back by the impact of the recent pandemic on construction activity.
The top 7 cities saw a total of 1,642 projects launched, cumulatively accounting for approx. 2,58,100 units in H2 2017 and the whole of 2018. Of these, 1,409 projects comprising 1,83,490 units have been completed so far.
MMR saw the most new launches between H2 2017 and entire 2018, with 679 residential projects comprising approx. 83,570 units. Of these, 602 projects (89%) are complete as on date.
Pune recorded the launch of 393 projects in this period, of which 350 projects (89%) are complete. The total number of units here stands at approx. 33,380.
In Bengaluru, around 172 projects comprising approx. 42,150 units were launched in these 1.5 years, of which 147 (85%) are complete.
Hyderabad witnessed 110 projects launched in the period, of which 81 (74%) are complete. The total number of launched units stood at approx. 24,215.
In NCR, approx. 86 projects comprising approx. 34,520 units were launched in this period, of which 64 (74%) are complete. One key factor behind NCR’s lower project completions is that the region also saw some large projects launched.
Chennai has been the frontrunner in project completions. The city launched 119 projects in the period, of which 107 (90%) are complete. The total number of units across all launched projects stood at approx. 20,900.
Kolkata saw 83 residential projects comprising approx. 19,350 units launched between H2 2017 and entire 2018. Of these, 58 (70%) are complete as on date – the lowest percentage share among the top 7 cities.