Home Sales Lifted due to Housing Supply Shortage
Bengaluru, Chennai, Hyderabad, MMR, & Pune are the cities where home sales witnessed growth in the first five months of 2021 versus the first five months of 2020 says a study.
By Varun Singh
Did Housing shortage lift home sales? The below piece may help you find answer for this question.
Homes sales saw a steep increase in the country in the first five months of 2021 compared to the same period in 2020.
In a report released by PropEquity, a real estate data, research, and analytics firm, home sales rose by 23% across the top 7 cities in India in the first five months of 2021 to 1,32,818 units versus 1,08,199 units in the first five months of 2020. The majority of the sales happened till Apr-15.
Bengaluru, Chennai, Hyderabad, MMR, & Pune are the cities where home sales witnessed growth in the first five months of 2021 versus the first five months of 2020 at 16%, 40%, 39%, 29%, and 34% respectively. Only Kolkata and NCR witnessed a downfall of 11% & 20% respectively in home sales during the same period.
“India witnessed the worst of COVID wave in the months of April and May which drastically stopped almost all real estate activity across major cities. Fortunately, the worst is behind us as the infection and COVID-related deaths have fallen significantly leading major cities to relax covid related restrictions. The vaccination drive has also picked up the pace and hopefully, there will be a limited impact from the third wave. We expect home sales to bounce back faster as the COVID recovery has been at a rapid pace,” Samir Jasuja, founder and managing director at PropEquity said.
Sales in NCR were greatly impacted as the National Capital faced a major brunt of the second COVID wave in which city went to a standstill to tackle the health emergency. This was followed by a stringent lockdown further impacting housing sales.
The new supply or launches of housing units decreased by 24% in the same period to 86,746 units from 1,13,699 units as developers were clearing earlier stock, resizing home offerings, and waiting for the economy to improve.
Chennai & NCR are the cities where new launches witnessed growth in the first five months of 2021 versus the first five months of 2020 at 20% and 50% respectively. Whereas, Bengaluru, Hyderabad, Kolkata, MMR, & Pune witnessed a downfall of 35%, 28%, 28%, 31% & 23% respectively in home sales during the same period.
“2020 was a difficult year for the real estate sector in India. This year however began with a solid recovery across segments and markets, but the sudden COVID wave again impacted the momentum due to the lockdown. As restrictions lifted around the beginning of June, we are now again witnessing housing sales, new launches, and business in general slowly getting back on track. We expect sales to further improve going ahead in the next quarter for projects that are being offered by fundamentally strong developers,” Ankush Kaul, President (Sales & Marketing) – Ambience Group, said.
|City||Jan-May 2020||Jan-May 2021||2020 VS 2021|
Bengaluru – India’s IT capital saw a rise of 16% in home sales in Jan to May 2021 at 15,364. New Launches decreased by 35% at 10,849 units.
Chennai – Chennai saw a 40% increase in home sales in the first five months of 2021 at 6,518 and new launches increased by 20% to 5,338 units.
Hyderabad – Home sales witnessed an increase of 39% in Jan-May 2021 at 14,959 units with new launches fell by 28% to 11630 units.
Kolkata – Surprisingly, Kolkata saw a decrease of 11% in home sales in first five months of 2021 at 4,673 units with new launches falling by 28% to 2,391 units.
MMR – The City of Dreams saw an increase of 29% in home sales in the first five months of 2021 at 51,040 units, whereas new launches fell by 31% to 30,290 units.
NCR – NCR saw a decrease of 20% in home sales in the first five months of 2021 at 9,106 units with new launches increased by 50% to 7,815 units.
Pune – Pune witnessed a rise of 34% in sales or absorption and downfall of 23% in new launches at 18,433 units in the first five months of 2021.