Housing sales touch 1.73 lakh units, up 11% in Jan-Jun; Homes worth more than ₹1 crore witness 41% growth in sales

Home sales surged by 11% YoY to touch 1.73 lakh units sold across the country’s top eight markets in H1 2024, marking the highest sales velocity in 11 years. New home launches also increased by 5.8% YoY, with 1.83 lakh units added in H1 2024.

Premiumisation trend rules in the residential sector

The premium housing segment of ₹1 crore and above saw a significant uptrend accounting for 41% sales during the period from 30% in H1 2023. In H1 2024 this ticket size category witnessed a growth of 51% YoY to 71,349 housing unit sales from 47,130 in H1 2023. The attribution from the affordable segment of ₹50 lakh and below shrunk to 27% from 32% in H1 2023, the report said.

Also Read: Housing sales up by 5% in FY24 in Mumbai Metropolitan Region, launches down by 22%: Report

Mumbai remained the largest residential market with sales at 47,259 units, followed by NCR with sales of 28,998 units and Bengaluru with 27,404 units. These three cities together constituted 59% of the total residential sales during the year, the new Knight Frank report showed.

NCR leads in sale of ₹1 crore homes

With sales of 20,795 units, NCR recorded the highest volume of sales in the premium segment among top 8 cities. NCR is followed by Mumbai and Bengaluru at 14,699 units and 13,698 units respectively, the report noted.

Overall, during Jan-June 2024, housing sales in Mumbai increased 16% annually to 47,259 units. This was fueled primarily by the 117% spike in the sale of units priced over ₹1 crore compared to the same period last year. In Delhi-NCR, housing sales declined 4% to 28,998 units. Bengaluru saw a 4% growth in housing sales to 27,404 units. In Pune, the housing sales increased 13% to 24,525 units.

Also Read: New housing supply expected to witness 13% drop; sales down 2% y-o-y across top cities

Chennai witnessed a 12% growth in sales of residential properties to 7,975 units. In Hyderabad, the housing sales went up 21% to 18,573 units. Kolkata witnessed a 25% growth in housing sales to 9,130 units. In Ahmedabad, the sales of residential properties during Jan-June rose 17% annually to 9,377 units.

Bengaluru witnesses housing price growth of 9%

While sales volumes have been robust in H1 2024, prices have also grown across all markets with Bengaluru growing at 9% YoY and Mumbai, NCR and Pune growing at 4% each. Prices in Chennai and Hyderabad also grew by a healthy 5% YoY each. This is the fifth consecutive half-yearly period of price growth across all markets, the report showed.

Sales in ₹50 lakh to ₹1 crore homes drop by 8%

Sales in the ₹50 lakh to ₹1 crore and ₹less than ₹50 lakh have dropped by 8% and 6% YoY respectively as homebuyer focus has shifted to the premium priced category during this period, the report showed.

The drop in the mid-segment sales can be viewed as a normal correction within a longer-term upward trend; however, the deceleration in the sale of units priced under ₹50 lakh has sustained for the past five half-yearly periods and it has been the only segment that has not seen any growth in an otherwise strong market, the report showed.

Also Read: Homes worth ₹1.11 lakh crore sold during Jan-Mar 2024; Up by 68% in value terms: Report

Increasing prices, higher home loan rates and the comparatively adverse impact of the pandemic on homebuyers in this segment, higher home loan rates and the comparatively adverse impact of the pandemic on homebuyers in this segment continued to weigh on demand, it showed.

Developers have been ahead of the curve and have judged the shifting preferences of the market by launching lifestyle-oriented premium products. The share of the number of units launched in the more than ₹1 crore ticket size category grew from 36% in H1 2023 to 47% in H1 2024, showed the Knight Frank India’s 21st edition of its flagship report – India Real Estate- Office and Residential Market (H1 2024).

The launch volumes in H1 2024 have surpassed the sales figures. A total of 1.83 lakh units were launched across the eight markets registering a 6% YoY rise. Mumbai recorded the highest residential launches in the country with supply of 46,985 units during the half year. Kolkata witnessed the highest growth (in terms of percentage growth) at 60% followed by Pune at 32%.

Commenting on the residential sector performance for the year H1 2024, Gulam Zia, Senior Executive Director – Research, Advisory, Infrastructure, and Valuation, Knight Frank India said, “The growth in the residential is firmly anchored by the premium category which saw a significant rise moving from 15% in H1 2018 to 34% in H1 2024. This premiumisation of the market is observed in demand as well as supply where the share of launches in the ₹1 crore plus homes has seen a corresponding rise in the first half of the year.”

“While we appreciate the rise in the premium sector, the corresponding decline in the lower price categories should be addressed to ensure that there is more inclusive growth of the market. Looking forward, we understand that the economic conditions will remain stable with the Indian economy continuing to grow, we expect sales momentum to remain robust for the rest of the year,” he said.

“India’s real estate market has been buoyant in the last few quarters owing to the strong economic fundamentals and stable socio-political conditions. As a result of this, both major segments of the real estate sector – the residential and office segment have recorded decadal high numbers. The residential market has recorded a significant rise of 11% YoY anchored by the premium category, which formed 34% of all sales in H1 2024,” said Shishir Baijal, chairman and managing director, Knight Frank India.

Having said that, the affordable and mid segment housing may bounce back if more incentives are announced in the forthcoming budget, he added.