Kolkata: Average housing prices across the top eightmarkets in India rose 11 percent YoY at Rs 11,000 per sq ft during Q32024, led by sturdy demand and positive market sentiments, a CREDAIstudy report said on Monday.
Average housing prices have increased for the 15th consecutive quartersince 2021. All the eight major cities saw an annual increase inhousing prices with Delhi NCR witnessing the highest rise at 32 pcYoY, followed by Bengaluru at 24 pc YoY rise during the quarter. Afterregistering record high sales over the last two years, the demandmomentum across the top cities is stabilizing. Nevertheless, withanticipation of healthy residential activity in the last quarter, 2024is likely to end on a strong note.
Overall unsold inventory continued to witness a quarterly drop for thethird consecutive quarter, led by healthy uptake in housing units. Atthe end of September 2024, unsold inventory stood at over 10 lakhhousing units across the eight major cities, with MMR accounting for amajority at about 40% share. Notably, unsold units in Hyderabad saw amodest dip on a sequential basis despite a yearly increase of about 28pc.
“The ongoing rise in housing prices is another validation of positivehomebuyer sentiments and the highly conducive nature of the realestate market. We are seeing more and more aspirational homebuyerscome to the fore – resulting in bigger homes that are also beingreflected in the rise in prices as homes continue to get moreexpansive, truly reflecting the current market dynamics and consumerpreferences. We expect this robust momentum to continue going into thenew year and are hopeful of rate cuts in the impending future.”President of CREDAI National Boman Irani said.
“While the housing market is gradually stabilizing, the outlook forthe residential segment remains positive supported by strongunderlying market fundamentals. Developers are recalibrating theirstrategies, particularly in the price-sensitive segments, by offeringcompact size units. Although average housing prices have continued toincrease steadily, witnessing a 11% YoY growth during Q3 2024, thelikely easing of monetary policy and anticipated repo rate cuts canpotentially bring financial relief to homebuyers in the near term.Moreover, flexible payment plans and freebies to attract homebuyerswill continue to aid in residential sales momentum,’ added BadalYagnik, Chief Executive Officer, Colliers, India.
“Sales and prices continue to grow, suggesting affordability anddemand are intact. The luxury segment is still dominant, although wehave been seeing a gradual reduction in new launches. While MMR, Pune,and Hyderabad are reaching a plateau in sales and supply, NCR,Chennai, and Tier 2 cities have a deficient supply level; they may seea surge in new launches”, said Pankaj Kapoor, Managing Director,Liases Foras.
Led by launches of select marquee projects within the luxury &ultra-luxury segment, housing prices in Delhi NCR increased 32 pc YoY,highest annual rise across the major cities. Within Delhi NCR, DwarkaExpressway and Golf Course Extension/Sohna Road witnessed asignificant price appreciation of over 50 pc YoY, leading to a sharprise in average housing prices at an overall level. Interestingly,compared to early years of the pandemic in 2020, average housingprices in the region have grown by about 75 pc, led by healthytraction in the luxury segment and continued demand for larger &spacious dwelling units.
Although unsold inventory levels remained high, it continued towitness a quarterly drop for the third consecutive quarter. At 13 pc,Pune saw the highest decline in unsold inventory levels annually.Interestingly, it was the fifth consecutive drop in inventory levelsfor the city. Annual decline in unsold inventory levels have beensignificant in Chennai and Kolkata too with 7-9% drop. Interestingly,7 out of 8 cities saw a dip in unsold inventory levels, on a quarterlybasis.
“With existing high unsold inventory levels to the tune of 10 lakhunits across the eight major cities, developers are being cautiouswith new launches. They are realigning their strategies by assessingand identifying the appropriate target audience in high demandpockets. Although new launches have moderated in the affordablehousing segment, developers have stepped up their offerings in luxuryand ultra-luxury segments. Average housing prices for spaciousdwelling units, particularly 3-4BHK configurations in cities likeBengaluru and Delhi NCR increased by up-to 26 pc YoY during Q3 2024.,”said Vimal Nadar, Senior Director and Head of Research, ColliersIndia.
