Residential sales in top 8 cities at nine-year high in 2022: Knight Frank India

Mumbai led residential sales in 2022 with 85,169 units, followed by the National Capital Region with 58,460 units and Bengaluru with 53,363 units.

Residential sales in top 8 cities at nine-year high in 2022: Knight Frank India
New home launches also witnessed a significant rise of 41% YoY in 2022 with the addition of 328,129 units in 2022.

As many as 312,666 residential units were sold across the top eight markets of India in 2022 in the January to December period, registering a growth of 34% year on year (YoY). New home launches also witnessed a significant rise of 41% YoY in 2022 with the addition of 328,129 units in 2022, according to Knight Frank India.

Mumbai led residential sales in 2022 with 85,169 units, followed by the National Capital Region (NCR) with 58,460 units and Bengaluru with 53,363 units.

The office sector in India saw a strong recovery in demand despite the geopolitical challenges, recording gross office leasing of 51.6 million square feet (mn sq ft), a rise of 36% YoY. New office space completions also grew by 28% YoY to 49.4 mn sq ft in 2022. In terms of the office space demand, Bengaluru led with 14.5 mn sq ft, followed by NCR with 8.9 mn sq ft transacted area during the year 2022.

Commenting on the same, Shishir Baijal, Chairman and Managing Director, Knight Frank India, said, “For the first time in over a decade we have seen simultaneous growth in all major real estate segments. Office, residential, warehousing and retail, all registered significant increase in activities in 2022. Factors like change in attitude towards home ownership, return to work and increased hiring and proliferation of e-commerce etc. backed by economic stability, allowed India’s real estate sector to benefit last year. This pace of growth is expected to largely remain in the new year owing to continued domestic economic growth. Having said that, India will have to remain cautious the of the global geopolitical and economic challenges as that can cast a shadow on the pace of growth for India.”

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2022 can be considered a watershed year for the residential sector across the top eight cities of India as after a significant period of decline, there was a substantial rise in sales, setting new decadal benchmarks. Annual sales that saw a rise of 34% YoY with sales of 312,666 units recorded a 9-year high.

Encouraged by this sales velocity, launches also saw a commensurate rise in 2022. A total of 328,129 units were launched across the eight markets, registering a rise of 41% YoY. Mumbai remained the largest market by volume both in terms of sales as well as new launches, followed by NCR and Bengaluru. Apart from Kolkata, that saw a slowdown in sales of residential by 10% YoY in 2022, all markets registered growth in both sales as well as new launches.

In terms of 12-month residential price change, Mumbai, NCR, Bengaluru and Pune registered increments of 7% each. Chennai and Hyderabad witnessed a significant increment of 6% while Kolkata and Ahmedabad witnessed an increment of 4%. A marginal rising of prices is a positive indication of a strengthening market but remained benign so far as impact is concerned as demand was adequately met by supply keeping market dynamics stable.

Commenting on the residential sector performance for the year 2022, Shishir Baijal said, “The residential sector was an exceptional story of growth in 2022, as despite numerous inflictions, the pace of growth remained largely intact. This momentum is the result of a definitive shift in attitude in favour of home ownership that has ignited the latent demand. The shift is so strong that despite some worsening in affordability on account of rising home loan interest rates, sales momentum has remained buoyant. Demand for homes has been further strengthened by continued economic growth, financial and income stability and moderately growing prices. Further, we estimate the pace of sales to remain unchanged in the new year, as most parameters are expected to remain favourable, including levels of inflation that is expected to start stabilising by mid of 2023.”


H2 2022 (July – December 2022) was the second best half-yearly period following H1 2022 in terms of sales volume in the last 18 half year blocks (9 years). Housing sales across top eight markets in India were recorded at 153,961 units in H2 2022, registering a 15% YoY growth. With central banks raising policy rates to fight inflation, and making mortgages more expensive, residential markets in India saw marginal sequential decline in volumes. Similarly, 167,323 units were launched during H2 2022, registering a 30% YoY growth in H2 2022.

Mumbai registered the highest sales of 40,969 units accounting for 19% YoY growth in H2 2022. Hyderabad witnessed the highest home sales growth (in terms of percentage growth) at 32% YoY followed by Ahmedabad at 25% while NCR and Mumbai grew at 24% and 19% YoY respectively. Kolkata was the only market to record a slowdown in sales. With steady momentum in sales volumes in H2 2022, residential prices also grew in the range of 1% to 3% across markets in H2 2022 compared to H1 2022. Bengaluru and Mumbai recorded 3% rise in average residential prices while prices in Kolkata remained stable during the period.

The high end and mid segment housing gained share in sales at the cost of the affordable segment in 2022, indicating some impact of deteriorating affordability at the price sensitive segment. However, sales volume in the affordable category also improved in comparison to the past period. The share of sales in the Rs 5 -10 mn segment grew from 35% in H2 2021 to 37% in H2 2022 while units above Rs 10 mn also witnessed a growth from 23% in H2 2021 to 28% in H2 2022. Conversely, the share of sales for units below Rs 5 mn category witnessed a decline from 42% in H2 2021 to 35% in H2 2022. The strong uptick in sales also brought the Quarters to Sell (QTS) level down to 7.2 quarters from 10.2 quarters in H2 2021.

Giving his views on the report, Pradeep Aggarwal, Founder & Chairman, Signature Global, said, “The real estate sector offers a gamut of opportunities to investors, ranging from residential to office spaces to retail segment, among others. Considering the overall scenario of the Indian economy, all the segments of the real estate sector, including affordable and mid-segment housing, will continue to attract investments as housing shortage continues across the country and demand remains robust.”

Abhishek Tripathi, Co-Founder, Settl, said, “Within the real estate domain, investors are increasingly looking at newer asset segments like co-living, co-working, student housing, and data centres, among others. The trend is likely to gather further pace over the next few years and segments such as co-living and student housing is expected to witness much larger investments and, thus, will drive the growth of the real estate industry.”

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First published on: 10-01-2023 at 12:59 IST
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