New Delhi [India], December 29 : Despite hardening property prices and home loan interest rate hikes in early 2023, it has been a strong year for the Indian residential real estate segment.
Data put out by real estate consultancy firm Anarock showed that housing sales in the top seven cities in India have created a new peak in 2023, breaching the previous high of 2022.
As many as 4.76 lakh units were sold in 2023 against 3,64,870 units in 2022 across the top cities - rising by 31 per cent on a year-on-year basis.
The last peak in the decade was seen in 2022, after 2014, when approx. 3.43 lakh units were sold in the top seven cities. The top seven cities, Delhi-National Capital Region, Mumbai region, Bengaluru, Pune, Hyderabad, Chennai, and Kolkata.
The greater Mumbai region, according to the Anarock data, witnessed the highest sales of approximately 1.53 lakh units in 2023, followed by Pune with about 86,680 units. The two western markets together led residential sales in 2023.
Coming to new property launches across the top seven cities, they saw a 25 per cent annual rise - from approximately 3.57 lakh units in 2022 to 4.45 lakh units in 2023. Mumbai and Pune saw the most new launches, together comprising a nearly 54 per cent share of total new launches in the year, the real estate consultant said.
"2023 has been phenomenal for the Indian housing sector, despite global headwinds, rising domestic property prices, and interest rate hikes over the first half this year. Housing sales in the top 7 cities breached the previous high of 2022, and new launches stayed in step with the current housing demand," said Anuj Puri, Chairman - ANAROCK Group.
"It was widely expected that rising property prices and interest rates, along with global market upheavals and uncertainties, would impact residential sales," says Puri. "The market put paid to these predictions."
Demand is likely to remain undeterred in 2024, even with average prices likely to appreciate by 8-10 per cent across the top cities. The unchanged home loan rates in the second half of 2023 helped maintain the overall positive consumer sentiment, it noted.
"While housing price hikes over the year did give rise to demand concerns, the unchanged home loan rates helped keep sales on an even keel," said Puri.
"Inflation in India has also more or less stabilized, and further hikes in the lending rate seem less than likely. The Indian economy remains bullish, and this directly correlates to residential demand. And, equally importantly, new supply is dominated by Grade A developers who are completing their projects on time. This is a strong housing demand bulwark."
Among the budget categories, luxury housing demand increased exponentially as homebuyers continued to look for bigger livable spaces post the pandemic. The new luxury supply addition across the top 7 cities in 2023 has jumped up five times when compared to 2018. There is no reason to expect luxury housing demand to taper off in 2024, Anarock asserted.
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