Affordable houses loose their sheen

There are few takers for affordable houses now, according to a report released by PropEquity, a real estate consultant.

According to the report, post the initial euphoria during early 2009, affordable segment has witnessed a gradual decline in absorption levels. However, these levels stand closer to sustainable levels. The mid-segment—defined as houses in the price range of Rs30-75 lakh—is a major contributor to the increased sales, surpassing in certain cases the absorption in the affordable segment.

The report takes into account prices, launches and absorption levels in the residential real estate segment over a period stretching from third quarter of 2008 to the first quarter of 2010, covering a total of 13 cities.

The report added that cities such as Gurgaon, on the outskirts of New Delhi, and Mumbai witnessed a decline in unsold inventory, indicating a revival after the slump in the market. However, while there has been a regular supply of units in the affordable and mid-housing range between the last quarter of 2009 and first quarter of this year, absorption levels have been low in most cities.