Residential real estate sales in India have breached the 2021 levels by far, witnessing a 50% YoY growth. New launches further strengthened during 2022 and registered a growth of 101% YoY with a total of 4,31,510 new homes launched during the calendar year 2022, as per the latest report by PropTiger.com.
According to the report titled Real Insight Residential – Annual Round-up 2022 (January – December), a total of 3,08,940 housing units were sold in 2022 as compared to 2,05,940 units sold in 2021. The figures include the sales numbers for all four quarters in both calendar years for the top eight cities, including Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, Delhi-NCR (Gurugram, Noida, Greater Noida, Ghaziabad and Faridabad), MMR (Mumbai, Navi Mumbai & Thane) and Pune.
A total of 4,31,510 units were launched in 2022, registering a sharp growth of 101% YoY as against 2021. New launches witnessed a multi-year high, registering a 6% increase as compared to 2015 levels. Mumbai has been the frontrunner in terms of new supply in 2022, taking a share of 39% in the overall launches, followed by Pune and Hyderabad which took a share of 18% and 19%, respectively.
This improvement in key growth metrics for the sector, the second-largest employment generator in India after agriculture, could largely be attributed to improved consumer sentiment on the back of renewed importance of home ownership during the pandemic, and sustained economic recovery post-pandemic.
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Mumbai, Pune lead property demand in 2022
The data and insights for 2022 suggest that demand has grown both sequentially and yearly in all four quarters of the year. The western markets Mumbai and Pune continued to show maximum traction, taking a combined share of 56% in overall sales in 2022.
A large chunk (26%) of the sales was concentrated in the Rs 45 lakh to Rs 75 lakh price range. Notably, the share of units in the more than Rs 1 crore price bracket has been growing continuously. This price bracket took a share of 22% in 2022, the highest in a decade. In 2022, 21% of the units sold were ready to move in while the remaining 79% were under construction.
In Q4 2022, residential demand was at par with the pre-pandemic levels of 2019. With 80,770 units sold in the final quarter of 2022, the demand registered 19% growth over Q4 2021. While the hike in property prices and interest rates have slowly begun to outweigh positive homebuyer sentiment to an extent and are expected to a have a short-term impact, the overall consumer outlook continues to remain positive.
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Buyer sentiment driving new launch wave
The visible change in approach towards home ownership amongst consumers in the aftermath of the pandemic has infused confidence in the stakeholders and encouraged real estate developers across top cities of India to launch new projects throughout 2022.
Maximum new supply in 2022 was concentrated in the Rs 1 crore to Rs 3 crore price bracket, taking a 28% share in the total launches. Units in the Rs 45 lakh to Rs 75 lakh price range took a significant share as well (27%).
In Q4 2022, 1,45,030 units were launched, recording a 95% increase YoY. The new launches have stayed above the 1,00,000 mark for the third consecutive quarter in 2022.
“Despite the industry’s numerous challenges, housing sales have rebounded strongly this year. It is worth noting that the industry is seeing higher demand and favorable sentiments. Despite the steady climb in home loan interest rates, customers have been interested in locking in lower prices rather than fretting about mortgage interest rates, which is also evident from our Consumer Sentiment Survey which indicated that homebuyers have been positive about the economy and their future earnings throughout 2022,” said Vikas Wadhawan, Group CFO, Housing.com, Makaan.com & PropTiger.com.
“It is important to note that we have seen strong growth across segments, including housing, office, retail, warehouse, data centers, co-working, and co-living. In the post-RERA world, NRI demand for Indian property has also increased and given a boost to Tier – II markets also,” said Wadhawan, adding, “significantly higher launches in this quarter also indicate that developers are gearing up for the strong quarter of January to March, which is generally the biggest quarter from a sales perspective.”