Magicbricks launches PropIndex

Company Brief

New Delhi, August 31, 2011

The India Apartment Index went up three per cent in the Apr-Jun 2011 quarter compared to the Jan-Mar 2011 quarter. These were the findings of “PropIndex, the India Apartment Index”, launched by Magicbricks.com, India’s No 1 property portal (Source: comscore). This is an aggregation of price and supply trends across 11 cities across the country & is based on data mined from the back-end of the property website. The report will subsequently be released quarterly.

Speaking on the launch of PropIndex, Sudhir Pai, Business Head for Magicbricks.com said “PropIndex is a culmination of the efforts that we have been putting to provide unbiased advice on property market performance to our users. It has the best of authentic site-data & original content thereby rendering itself an excellent source of credible information for property-led decision making for both users as well as the developer/realtor community”.

In this index, the focus is on apartment trends & covers the most active top 11 cities of the country. In each city report, to ensure a holistic perspective of the performance of real estate markets, 4 different, key metrics have been covered – PropIndex (which is a composite index of capital appreciation, supply & apartment rates), Price Monitor (which shows capital appreciation), Rent Monitor (which should rental appreciation) and Yield Monitor (which shows the rental yields within each city).

PropIndex has been able to address the 2 key challenges to setting up of an Index in the real estate space: Availability of sufficient sample data at a locality level & authenticity of this data. As India’s largest property portal, Magicbricks had the largest pool of data available – sourced from over 5000+ properties that get posted daily by a base of over 1Lac users covering over 300+ cities & 3500+ localities in the country. A total of over 4Lac Property listings available at any point of time with a base exceeding 6000 clients ensured that a statistically relevant sample data for this exercise. A smart algorithm that was created ensured the right data selection & removal of statistical anomalies; additionally, the large pool of industry experts on Magicbricks has validated the findings of the Index thereby attesting to data authenticity. Jayashree Kurup, Head – Content & Research, Magicbricks.com added “Creation of this Index required us to put together an algorithm that could not only handle the voluminous data but also take care of data outliers & statistical anomalies; we have been able to put together an Index, the results of which have been validated by Industry experts”.

The main finding is that property prices have maintained an uptrend in most cities. Majority of cities had portrayed uptrend in the property price values in the quarter Apr-Jun 2011 and the same have been captured by Price Monitor of respective cities. Over 50% of the localities across the cities have shown uptrend in average capital values. However, in rental market over 65% of the localities across cities have shown rise in rental values.. Out of the 11 cities covered in PropIndex eight have shown uptrend in values. Cities such as Delhi, Kolkata & Bangalore have registered maximum increase in average capital value per sq ft. In cities such as Delhi increase in capital values is primarily attributed to large scale redevelopment in old localities and limited new supply in the market. Where new areas have been developed such as Dwarka, there have been a significantly large number of properties for sale in the market.

Economic corridors are big drivers for residential apartment sale. Since economic drivers have been good in most cities, majority of cities had portrayed uptrend in the property price values in the quarter Apr-Jun 2011 and the same have been captured by Price Monitor of respective cities. Over 50% of the localities across the cities have shown uptrend in average capital values. However, in rental market over 65% of the localities across cities have shown rise in rental values.

Another big contributor to the growth or decline has been the newly developing corridors of growth where the available supply for sale and rent has increased significantly. Capital values are significantly impacted when new transport infrastructure such as flyovers and metro are either announced or become operational. Rental values too change with input of infrastructure. Yields for low ticket investments are higher than those with higher capital values.

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Times Group

Apeksha Kaushik

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Email: apeksha.kaushik@timesgroup.com