Housing sales have grown by 7 per cent in Q1 2023 on a yearly basis, while new launches have decreased by 18 per cent across the top-14 cities in India, according to a report by PropEquity.
The number of units sold in tier-1 cities in India in Q1 2023 far exceeds the number of units launched in the same time period, according to a report by PropEquity, a real estate data analytics platform. The Jan-Mar 2023 quarter saw 93,600 residential units launched against a sale of 123,938 units in tier-1 Indian cities.
Across the top-14 cities, housing sales increased by seven per cent year-on-year (y-o-y) due to infrastructure growth, government policies, and robust launches, while quarterly sales have exceeded new launches by 32 per cent in Q1 2023.
A total of 21 per cent of housing sales was recorded in Pune alone. New launches have decreased by 18 per cent y-o-y in Q1 2023.
“The top three cities in terms of quarterly sales were Pune, Thane and Hyderabad, with Pune leading the market with 25,536 units sold in Q1 CY23 with a market share of around 21 per cent of the total absorption witnessed in the top-14 cities,” the report said.
These three cities also lead the chart in terms of new launches, though Gurugram saw the highest growth in new launches with 9,610 launches, up by 560 per cent over previous year.
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According to the report, in the first quarter of 2023, there was an 18 per cent decrease in the number of new launches, with 93,600 residential units compared to 113,491 units launched in the first quarter of 2022.
The decrease in new launches may have been influenced by various factors, such as current market conditions, supply chain disruptions and delays in construction activities, the report said.
According to the report, the price of sold units saw the highest rise in Gurugram (42 per cent), followed by Noida (32 per cent) when compared to price in the previous year.
In Faridabad, prices dipped by two per cent, while in Navi Mumbai and Thane, prices rose by five per cent, while in Chennai the price rise was confined to two per cent compared to last year. But compared to the last quarter, Navi Mumbai and Chennai saw prices of its housing units dip.
According to the report, the trend of decline in the number of new launches started with the onset of the Covid-19 pandemic in 2020, and it is believed to be due to the clearance of earlier stock. On a yearly basis, unsold stock saw a 14 per cent dip across the cities.
The available inventory in the top-14 cities is estimated to be 517,879 units by March 2023-end.
Says Samir Jasuja, founder and managing director at PropEquity: “With nearly 123,938 units sold in the first quarter of this year, the residential market has entered a new stage of development and new standards have been set.”
According to the report, residential sales and launches have also reached record highs, as branded developers have upped their game and are providing supplies according to changing customer demands. This positive trend is expected to continue, buoyed by the government’s initiatives to boost infrastructure development and the ease of doing business.
Says Ankush Kaul, chief business officer, Ambience Group: “Home sales across all the top cities of India have registered double-digit growth. We see sales reaching an all-time high with a whopping 170 per cent yearly growth in Gurugram. This is particularly noteworthy considering the challenging global environment and the hardening of interest rates on home loans in the domestic market.”
The report added: “The real estate market has shown resilience and continued growth, especially in the affordable housing segment, driven by increased demand from middle-class and first-time homebuyers.”
Incidentally, despite the bull-run in the housing market, successive research reports suggest that affordable housing has been moderately affected by the pandemic, increases in home loan interest rates, and high cost of land.
Even houses priced below Rs. 30 lakh have become unaffordable for blue-collar workers, who were most affected by the Covid-19 pandemic. They are now delaying their purchase and often resort to rental spaces. The Centre under PMAY (Urban) has sanctioned more than 122 lakh homes in the affordable segment, which has also caused a dent in this segment, the report added.