The time it takes for property seekers to finally make the purchase, known as the lead-to-buy lag, has narrowed significantly in the growing residential real estate sector of India. This lag-to-buy time frame now stands at 26 days in the first half of FY2025, according to the latest data from ANAROCK Property Consultants. This is being seen as an improvement from the high of 33 days back in FY2021.
The trend shows growing confidence among Indian homebuyers in addition to a stronger demand, wherein both are driven by rising supply from developers across the country.
Housing investments are typically for the long overhaul wherein property seekers go for options that trickle down to their diverse array of budgets. The data reveals a fascinating contrast in buying behaviors across different price brackets.
Affluent buyers who are looking for ultra-luxury homes (properties priced above Rs 3 crore) are making purchases in 15 days flat, the data shows. Earlier this time frame used to be 22 days in FY2024. Such a reduction in decision-making time frame shows that high-end buyers are looking to secure luxury properties in a sector that is witnessing a growing demand amid a limited supply.
Says, Anuj Puri, Chairman - ANAROCK Group, "Ultra-luxury homes buyers are financially equipped to make quicker decisions. Also, high-end homes are currently in greatest demand and desirable inventory tends to sell out fast, necessitating a need for speed."
In comparison to this, those with limited means are finding it difficult to make the final decision leading up to their purchase. Among all budget categories, the data shows that buyers of homes priced between Rs 50 lakh to Rs 1 crore took the most time, around 30 days, to decide on buying a home from the day they first got a lead to pay in the booking amount. This gap has grown which was 20 days in FY2024.
"If we compare H1 FY2025 data with that of the previous fiscal (FY2024), we note a slight increase in the conversion time from 25 days in FY2024 to about 26 days in H1 FY2025,” Puri notes.
Such an uptick can be attributed to the general rise in property prices over the past year, which is giving buyers in this bracket a pause before they commit.
However, mid-range home buyers, those looking to purchase properties ranging between Rs 1 crore to Rs 3 crore are also showing slightly more confidence. The lower end of this range, between Rs 1-2 crore, earlier took the most deliberation in FY2024. The conversion time for this group, 32 days, has come down to 27 days.
For properties in the Rs 2-3 crore range, the buying average stands around 26 days. The conversion time for affordable housing has also shrunk minutely from 27 days in FY2024 to 26 days currently.
The buyers took the most time to purchase homes in FY2021. The data shows we have come way forward in terms of consumer confidence given that the last few years have seen a surge in new supply by branded developers.
However, the report concludes that despite a decrease in lead-to-buy periods, the sector may not see any significant changes. This can be attributed to the Indian buyers’ behaviour who do not make property decisions lightly since it sweeps away a significant portion of their savings.
Says Puri, “Obviously, luxury and ultra-luxury home buyers do not operate from a place of financial constraint” but this segment constitutes just about 10-11 per cent of the overall Indian residential market sales currently. This means that affordable, mid-range, and, of late, upper-mid-range buyers will continue to define how the demand landscape of this market plays out.
