The real estate industry and its experts might have projected 2013 as the "year of deliveries" but a look at numbers seems to tell a completely different story.
Till July this year, of the committed supply of 406,539 housing units, only 143,838 had been completed, according to data from real estate research firm PropEquity. That comes to 35.38 per cent - just a tad more than a third.
In Gurgaon, the committed supply was 22,571. But till July, only 7,645 units, or 33.9 per cent had been delivered by developers. In Noida, of the 36,847 units promised, only 7,672, or 20.8 per cent, were delivered. Mumbai fared a little better, delivering 7,990 of the 18,725 promised units - 42.7 per cent. Pune also scored much better than the National Capital Region (NCR)by delivering 26,376 of the 59,766 units committed (44.1 per cent).
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"Focus on execution is slow," says Shveta Jain, executive director (residential services), Cushman & Wakefield.
"The developer's focus is more on launching new projects and acquiring land banks than execution. Though it would vary from city to city, this stands true for Delhi and NCR," she adds.
The total committed supply across 15 major cities has been pegged at 406,539 for 2013. This is higher than the supply levels of 324,711 and 253,795 units in 2012 and 2011, respectively, show PropEquity data.
Of the 15 cities tracked, NCR's performance - with only 21,371, or 23.3 per cent, of the 91,558 committed units being delivered - has been the worst.
PropEquity Founder & CEO Samir Jasuja agrees that there would be delays by developers, because of several factors, leading to spillover to the next year.
"Looking at the current status of the economy, high cost of construction, high interest rates and the liquidity crunch being faced by the developers, a few projects are likely to get delayed and spill over to the next year," Jasuja says.
According to a major real estate player operating out of NCR, there have been inadvertent delays due to reasons ranging from late approvals, economic slowdown and farmer issues, besides fund problems.
Despite the industry-wide enthusiasm, a leading consultancy firm (which does not want to be named) had cautioned it would be difficult for developers to deliver even half of the committed supply for 2013. Developers, at that time, were confident of delivering.
Experts say the liquidity crunch is also a key reason for developers not being able to deliver on time. Many developers came with schemes and offers like free registration and no stamp fees, besides gold coin, bikes and cars, with apartment bookings. Despite that, sales refused to look up. Now, all eyes are on Diwali, which is expected to give the much-needed fillip to the real estate industry.
"While liquidity issues do take a toll on execution, some of the delays are also occurring because small developers are trying to execute projects beyond their execution capabilities," Jasuja adds.
Some delays have happened because of approvals not coming on time and the liquidity crunch faced by the developers, Jain further adds.
A person tracking the sector, however, differs. He says the projects that have been delayed were launched around 4-5 years back. So, the current economic slowdown should not have impacted these projects.
A recent research by international advisory firm Jones Lang LaSalle (JLL) said as many as 63 large residential projects in NCR were delayed - some by four to six years. The delayed projects include those of Parsvnath, DLF
(Belaire), Jaypee Group (Jaypee Greens), BPTP and Unitech
Despite this, most of these companies have gone ahead and launched projects this year, too.
Corresponding with delivery delays, the inventory levels have risen. Mumbai has an inventory of close to 48 months, Delhi of 23 months and Bangalore of 25 months. This is above the comfortable level of 14-15 months, according to JLL.
"Inventory levels in seven of India's leading cities are much higher than the comfortable industry level seen eight-10 months earlier. That was between 14 and 15 months of unsold supply. As a result, the ability of the market to cling to current prices is under severe stress," said Ashutosh Limaye, head (research & real estate intelligence service), JLL.