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Additional housing demand likely to be 2.1 million units in 5 years: cushman & wakefield

The Economic Times, Kailash Babar, Mumbai

October 03, 2012


Major Indian cities are estimated to see additional demand for housing around 2.1 million units in the next five years and more than 50% of this will be in the mid-income segment, property consultant Cushman & Wakefield said in a report.

Around 18% of pan-India additional demand during these five years is likely to be concentrated across the top eight cities including Mumbai, National Capital Region, Bangalore, Chennai, Pune and Kolkata.

Of the total additional demand in the top 8 cities, demand for mid-income housing is estimated to be highest at 1.3 million units, while high-end segment demand is estimated to be 451,000 units and 362,000 units in low-end segment.

"The residential housing demand can be seen as an indication of the current and future economic activities in these cities. Majority of the growth in demand (in the top 8 cities) is expected to come from the services sector. Bangalore, Hyderabad, Mumbai and NCR, Pune and Chennai will see demand on account of both services as well as manufacturing sectors," said Sanjay Dutt, Executive Managing Director, Cushman & Wakefield India.

During these years, the total demand for housing units is expected to increase at a compounded annual growth rate ( CAGR) of 2.8% across India, with Bangalore expected to the record the highest rate of 4.1% followed by Pune and Hyderabad.

NCR is expected to see the highest demand of 381,000 units in mid and high-end segments during 2012 - 2016. In the western region, Mumbai is expected to see demand of 188,708 for mid and high-end housing while demand in Ahmedabad for the same category will be 173,394 units, while Kolkata's mid and high-end demand is touted to be about 77,000 units.

The three southern cities namely Bangalore, Chennai and Hyderabad would account for nearly 45% of the demand in mid and high-end segments.