Home sales in India surged to their highest in seven years in the first quarter of 2022, underscoring the role record low interest rates have played in fueling ownership demand in a country where real estate continues to be the biggest asset class for the average saver.
In the top seven cities, 99,550 units were sold, up 71% against 58,290 units sold back in the first quarter of 2021, Anarock Research said.
Mumbai, Dew Delhi and the surrounding regions of the country’s two biggest cities accounted for over 48% of the total sales in the top seven cities. Sales in the National Capital Region (NCR) more than doubled.
“The bull run in the housing market continued in the first quarter of 2022, thus recording all-time high quarterly sales since 2015,” said Anuj Puri, Chairman – ANAROCK Group. “The impact of the third Covid-19 wave was significantly lower than of the preceding two waves. The unrelenting appetite for homeownership amid the pandemic has coupled with a growing certainty of impending price rises to speed up housing sales velocity.”
Interest rates in India are at a record low, with the central bank reducing the cost of money since the start of the pandemic to boost demand and aid the broader economic revival. India has split ranks with other central banks in not raising rates, seeking to provide the monetary underpinnings necessary for a durable recovery.
New launches also surged 43% – to over 89,150 units from 62,130 units.
As in the previous quarter, MMR and Hyderabad saw the maximum new supply, accounting for 51% of the total new launches across the top 7 cities. Individually, the two cities saw 59% and 71% yearly increases, respectively, in fresh housing starts.
“Buyer sentiment remains positive as witnessed by the demand in our ongoing and completed projects. The momentum in our residential business will continue with the launch of around 2.4 Mn sqft of new projects in the upcoming quarters,” said M R Jaishankar, CMD, Brigade Enterprises Limited.
Brigade Enterprises Ltd. has reported sales of 1.1 mn sft valued at Rs 684 crore in the December quarter.
The key cities contributing to new launches in Q1 2022 included MMR (Mumbai Metropolitan Region), Hyderabad, Pune, and Bengaluru, together accounting for 82% supply addition.
“We look forward to further growth in our sales in 2022, backed by the robust launch pipeline of over 15 mn sqft,” said Venkat K Narayana, Chief Executive Officer, Prestige Group.
Despite the new launches, unsold inventory in the top seven cities saw a 2% yearly decline – from 6.42 lakh units toward Q1 2021-end to 6.28 lakh units by Q1 2022-end. Chennai, MMR, and NCR saw the highest yearly declines in Q1 2022 – by 11%, 10% and 9%, respectively, the report mentioned.
Average residential property prices across the top 7 cities increased in the range of 2-5% in Q1 2022 when compared to Q1 2021, mainly due to increase in the prices of construction raw materials. Hyderabad recorded the highest 5% annual jump.
Source : ET