Top 8 cities including Mumbai, Delhi-NCR, Bengaluru, Pune, and Hyderabad are leading this uptrend, driving substantial growth, and has helped the country’s residential real estate market scale an 11-year high in sales volumes in the first half of the year.
Total sales across top 8 Indian cities have witnessed 11% on-year growth at a total 173,241 apartments, showed data from Knight Frank India. Development activity has scaled up to tap into the rich vein of demand that the residential market is currently in the midst of.
The 183,401 units launched in the first half of 2024 represent a 10-year high in terms of units launched in a half-yearly period and are well attuned to the changing preferences of the homebuyer that are now significantly leaning toward experiential living and squarely aimed at an upgraded lifestyle.
“India’s property market has been buoyant in the last few quarters owing to the strong economic fundamentals and stable socio-political conditions. As a result of this, both major segments of the real estate sector–the residential and office segment–have recorded decadal high numbers,” said Shishir Baijal, CMD, Knight Frank India.
He expects a strong finish to the year 2024 with both residential and commercial office transactions noting record highs, the current trajectory of growth and continued stability in the socio-political conditions.“This growth is firmly anchored by the premium category which saw a significant rise moving from 15% in H1 2018 to 34% in H1 2024…While we appreciate the rise in the premium sector, the corresponding decline in the lower price categories should be addressed to ensure that there is more inclusive growth of the market,” said Gulam Zia, Senior Executive Director – Research, Advisory, Infrastructure, and Valuation, Knight Frank India.He expects the sales momentum to remain robust for the rest of the year as the economic conditions will remain stable with the Indian economy continuing to grow.
The launches during the period have surpassed the sales figures. A total of 183,401 units were launched across the 8 markets, up 6%. Mumbai recorded the highest residential launches in the country with supply of 46,985 units, while Kolkata witnessed the highest growth, in terms of percentage growth, at 60% followed by Pune at 32%.
The quarter-to-sell (QTS) level, time required for inventory liquidation, for the eight markets has fallen to 5.9 quarters or 18 months from 9.5 quarters in the first half of 2021 depicting a market with improving fundamentals. The QTS level of the premium category depicts a healthier picture at 5.1 quarters, indicating that the inventory here is still not a concern.
Mumbai registered the highest sales of 47,259 units demonstrating a 16% on-year growth during the period. Kolkata witnessed the highest home sales growth, in terms of percentage, at 25% followed by Ahmedabad at 17%.
Residential units priced over Rs 1 crore and above constituted 41% of the total sales. Sales in this segment have grown by 51% and it has been the primary driver for overall sales growth during the period.
The sales share of residential properties priced at Rs 50 lakh and below dropped to 27% from 32% a year ago. Rising property prices, higher home loan rates, and the pandemic’s disproportionate impact have dampened demand in this category. This contrasts sharply with the 54% sales share observed in the first half of 2018.
Incidentally, the most expensive residential market in the country, Mumbai region, also accounts for the most affordable segment sales among the eight cities. The affordable segment in Mumbai witnessed an annual growth of 11% to 21,043 units in the first half of 2024.
