Housing sales up 20% in top 6 cities

Hyderabad: Housing sales in India’s top six cities – Delhi NCR, Mumbai, Bengaluru, Hyderabad, Chennai, and Pune –surged by 20 per cent during the January-March period, as per a report of NoBroker. The number of housing units sold has reached around 1.47 lakh units. This anticipated growth reflects the resilience and potential of the market, fuelled by ongoing developments and investments in the property market.

Amit Agarwal, CEO & Co-founder of NoBroker.com, said: “The average rent increase has been higher than average salary increments across cities which has prompted potential home buyers to take the plunge. While rents may stabilise with more supply coming in gradually, they will not come down. This year has begun with an outstanding start, observing heightened demand and exponential surge in property transactions.”

“The growth trajectory of the country’s economy, coupled with controlled economic policy environment has boosted the confidence of buyers to make the plunge. Although the property price escalations persist, we are anticipating robust sales, which is indicative of buoyant homebuying sentiment and buyers’ persistence to owning a physical asset. This outlook is further steered by relatively cheaper home loan interest rates, which currently varies between 8.30-11.15 per cent per annum,” he said.

“It is interesting to note a new trend emerging among homebuyers, indicative of a ‘K-type’ growth trajectory. Individuals previously eyeing properties within the price range of Rs 80 lakh to 1 crore are now upgrading their preferences above the Rs 1-crore mark. They are choosing bigger unit size and properties within gated societies.”

However, those initially considering homes between Rs 60 to 80 lakh are opting for more affordable options, marking a downward shift in their housing choices. This divergence in purchasing behaviour underscores the diverse impacts of market dynamics on different segments of the population, contributing to the bifurcation of growth patterns.

Against a backdrop of surging demand, we have even observed that certain projects have been absorbed within a day of their launch, underscoring the rapid pace of transactions in the market.

Furthermore, properties nearing completion are witnessing a notable uptick in prices, intensifying the frenzy among buyers to secure their purchases before further escalations. Adding to this dynamic landscape, there’s a discernible trend emerging where grade-B builders command prices on par with their grade-A counterparts, signalling a levelling of the playing field in terms of pricing dynamics.

Given the strong residential demand and the surge in input costs, there will likely be sustained pressure on property prices, resulting in further upward revisions. Also, the easing of retail inflation in India has the potential to positively impact real estate buyers by enhancing affordability, improving borrowing conditions, and fostering a more conducive market environment for property transactions. NoBroker’s annual real estate report 2023 highlighted the enduring confidence of investors in real estate as a prime investment avenue. This is evident from 74 per cent of the surveyed participants expressing a preference for it over other more volatile options such as SIPs, stocks, gold, and bitcoin. Among the major cities, Delhi-NCR and Bengaluru account for 45 per cent of total sales. In fact, Bengaluru is set to witness over 25 per cent jump annually vis-à-vis 2023.