Measures like RERA and GST have already led to positive signs being witnessed in the Indian real estate sector and cities like Pune are poised to reap the maximum benefits. Pune real estate has performed better in comparison to many other big cities for a long period of time. The inclusion of the city in the list of 100 Smart Cities has also been a major boost in terms of infrastructure development. The implementation of the Maha RERA has also led to some changes in the market. Developers are now displaying their RERA registration numbers prominently in advertisements for new projects. New launches have certainly slowed in Pune after RERA and bigger developers are now concentrating more on finishing their ongoing projects and getting them compliant with RERA.
Smaller developers in the unorganized realty arena are focusing on varied market strategies for sustenance in the market. They are either selling off their land banks to buyers or joining hands with well-known developers for projects. They are also attempting to make their projects compliant with RERA guidelines. Pune’s realty market witnessed lower growth last year with launches coming down over some quarters on account of the unsold inventory from 2015 and some anxiety about upcoming regulatory upheavals. Unsold inventory in Pune stands at approximately 41,000 units by the end of the second quarter of 2017.
However, there are some signs of recovery witnessed in the Pune real estate market. End-users are the major growth drivers for the property market in Pune and speculative investors only contribute around 10-15% of overall purchases now in comparison to 20-25% back in 2010-11. The highest-selling space in the Pune realty market right now is the mid-income category (Rs.4,500-6,000 per sq. ft.) and affordable housing (Rs.3,000-4,500 per sq. ft.).
The higher segment (Rs.6,000-9,000 per sq. ft.) is witnessing lower sales activity while luxury homes continue to witness lower sales volumes in comparison to the peak witnessed in 2010-11. Micro-markets like Wanowrie, Hadapsar, Aundh and Kharadi saw 8-12% of growth in 2016 while this is around 8-10% for Hinjewadi, Pirangut, Dhanori, Bhugaon, Wagholi and Undri-Pisoli. The Pune real estate market is maturely adjusting to regulatory upheavals. There is increased demand for housing solutions priced between Rs.20-35 lakhs. Average appreciation in capital values stand at around 3-5% across multiple micro-markets.
Mid-range and affordable housing categories witnessed sales volumes in excess of 25,000 between the second quarter of 2016 and first quarter of 2017. The key growth drivers include the booming IT and ITeS sectors along with healthy creation of jobs in automobile and manufacturing industries. The proposed Pune Metro will boost the CBD along with Aundh, Hinjewadi, Kharadi, Viman Nagar and Pimpri-Chinchwad. The proposed Ring Road will also boost peripheral zones in the city along with the Pune riverfront development venture.
Pune primarily remains a market for end-users and buyers even now. The sentiments are quite positive for the real estate market in Pune at present and the steady growth trends should continue this year according to experts.