Around 50 per cent of the total developers in top nine Indian cities have exited the market in a span of five years, says PropEquity
Around 50 per cent of the total developers in top nine Indian cities have exited the market in a span of five years due to factors such as lack of execution capability, demonetisation, demand-supply dynamics, according to research by PropEquity, an online real estate data analytic platform.
The online firm added that most of the unorganized developers have failed to deliver on execution due to lack of inherent financial stability and the consequent liquidity crunch. These small scale developers did not have the financial strength to adapt to the new system and practices.
On the other hand, the top developers have replaced the smaller players in the market.
“Consumers are now looking for the developers with excellent track records in terms of quality and execution. This will further refine the developer market based on their sustainability in terms of deliveries and fair practices”, said Samir Jasuja, Founder and Managing Director at PropEquity.
Therefore most of the small-scale developers either exited the market or joined hands with larger developers. This impact of the developer consolidation has been witnessed across the country.
Gurugram and Noida market
The research added that the total number of projects launched by top ten developers in Gurugram and Noida stood at 55 per cent and 78 per cent respectively in 2018 as compared to 28 per cent and 52 per cent respectively in 2011.
The total number of projects launched across the cities also declined substantially during the same time period.