Residential Transactions and Sales Value Trends

In 2024, the number of registered residential transactions reached 5.77 lakh, compared to 5.56 lakh in 2023, reflecting a 4% increase. The registered sales value also rose to Rs. 4.03 lakh crore, up 2% from Rs. 3.95 lakh crore in 2023. Despite a slight dip in the average sales value per unit (Rs. 0.70 crore in 2024 from Rs. 0.71 crore in 2023), the overall performance demonstrates the ongoing strength of the residential real estate sector.

Tanuj Shori, Founder and CEO of Square Yards, commented, “The Indian residential real estate market has entered a promising phase post-pandemic, fueled by pent-up demand and a renewed desire for homeownership. While the sector experienced exceptional growth in the past few years, the numbers in 2024 indicate a natural market cycle. Annual sales have consistently surpassed 5 lakh units and Rs. 4 lakh crore in total value—far exceeding pre-2020 levels. This is not a slowdown but rather a sign of a maturing market, poised for sustained growth in the coming years.”

Regional Performance

The western region emerged as the dominant player, with cities like Mumbai, Thane, Navi Mumbai, and Pune accounting for 61% of the total registered transactions and 69% of the overall sales value. In the southern region, Bengaluru and Hyderabad together contributed 25% of the total transactions. Bengaluru recorded nearly 0.8 lakh registrations, although a slight dip occurred due to the E-khata rollout. Hyderabad, however, continued its upward trajectory, recording 80% of Bengaluru’s volume, strengthening its position as a key real estate hub.

Price Trends Across Major Cities

The sustained demand in 2024 has led to significant property price hikes across major cities. Gurugram stood out with an extraordinary 132% rise in property prices since 2019, driven by high demand for luxury and ultra-luxury homes. Other northern cities like Noida and Greater Noida also saw substantial price increases, with the upcoming Jewar Airport further boosting interest in these areas. Over the past five years, property prices across key cities have witnessed remarkable growth, with prices rising by an average of 60%.

Price Growth Over the Last 5 Years (2019 vs. 2024):

• Gurugram: Rs. 5,820 to Rs. 13,500 (132%)
• Noida & Greater Noida: Rs. 4,500 to Rs. 7,500 (67%)
• Bengaluru: Rs. 5,450 to Rs. 9,050 (66%)
• Pune: Rs. 5,200 to Rs. 8,300 (60%)
• Ahmedabad: Rs. 3,580 to Rs. 5,500 (54%)
• Hyderabad: Rs. 5,250 to Rs. 7,500 (43%)
• Mumbai MMR: Rs. 9,500 to Rs. 14,200 (49%)
• Chennai: Rs. 5,200 to Rs. 6,940 (33%)
• Kolkata: Rs. 4,510 to Rs. 5,890 (31%)

Supply and Developer Confidence in 2024

Developers exhibited strong confidence in 2024, launching over 3.9 lakh new units and delivering more than 4 lakh units across major cities. The demand for gated communities and lifestyle amenities led developers to align their offerings with evolving consumer preferences. Developers also embraced cutting-edge technology and innovative designs. The NIFTY Realty Index, which tracks the performance of leading real estate stocks, outperformed other sectoral indices on the NSE in 2024, registering an impressive 40% gain year-to-date.

Outlook for 2025

Looking ahead to 2025, the outlook remains optimistic, with over 3.6 lakh units expected to be delivered across major cities. Leading developers have an ambitious pipeline of nearly 300 million sq. ft. for FY2025. This robust pipeline is anticipated to further boost transaction volumes and cater to the diverse needs of buyers. Despite a moderation in growth rates, the Indian real estate sector continues to perform well above pre-pandemic levels. The positive economic environment and shifting lifestyle preferences are expected to sustain momentum, ensuring another promising year for developers, homebuyers, and investors.

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Affordability Improvements on the Horizon

The affordability outlook for India’s residential market is promising. With the Reserve Bank of India (RBI) signaling a shift towards a neutral stance on monetary policy, a potential rate cut of 50 basis points over the next 12 months is expected to enhance affordability. This, combined with moderate price growth and rising household incomes, will support an improvement in affordability levels across the country’s key real estate markets.

JLL’s HPAI predicts that Mumbai and Pune will approach near-optimal affordability by 2025, meaning that the average household income in these cities will be sufficient to qualify for home loans based on the prevailing property prices. Kolkata, on the other hand, is expected to maintain its lead as the most affordable major city, potentially reaching new affordability peaks.

While Delhi NCR and southern cities like Bengaluru, Hyderabad, and Chennai are also set to see improved affordability, they are likely to remain below their peak affordability levels. However, even these cities will experience better affordability than in previous years.

Record Residential Sales Expected

The anticipated improvements in affordability come at a time of strong growth in India’s residential market. Residential sales are forecast to reach 305,000-310,000 units in 2024, and further growth is expected in 2025, potentially pushing sales to a new peak of 340,000-350,000 units. This surge in sales reflects a growing demand for housing, driven by evolving homeownership dynamics and rising household incomes.

Despite the challenges posed by higher property prices and interest rates in recent years, the market remains resilient, with a sustained bull run driven by strong homebuyer demand. The expected interest rate cuts, alongside moderating price growth and continued income increases, are poised to further fuel the market’s momentum over the next 12-18 months.

Factors Driving Affordability Shifts

JLL’s Chief Economist, Dr. Samantak Das, explains that while the overall economic outlook remains soft, India is still projected to be one of the best-performing large economies globally, supporting steady growth in household incomes. He notes that in 2021, affordability across all major markets reached peak levels. However, rising property prices and persistent interest rates caused affordability to dip in 2022 and 2023. With the anticipated interest rate cuts and moderate price growth, affordability levels are expected to improve to their best since 2022, creating a favorable environment for homebuyers.

The report also highlights the significant growth in real estate prices over the past decade. Hyderabad leads with a 132% price increase since 2011, followed by Bengaluru at 116%, and Delhi NCR at 98%. On the income front, Mumbai has experienced the highest growth, with a 189% increase in household incomes over the same period.

Future Outlook for the Market

Looking ahead, Siva Krishnan, Senior Managing Director at JLL, notes that the combination of strong income growth, potential interest rate reductions, and moderating price growth is expected to improve affordability across India’s key markets. This will ensure continued activity in the residential market, with sustained demand despite ongoing price increases.

JLL’s HPAI will continue to be a vital tool for aligning homebuyers’ affordability with suitable property offerings, ensuring that market demand remains resilient and responsive to economic shifts. The report emphasizes that strategic policy interventions, along with continued improvements in household incomes, will be critical in sustaining demand elasticity in India’s residential real estate market.

Conclusion

India’s residential real estate sector is on track to see improved affordability by 2025, driven by expected interest rate cuts and rising incomes. While cities like Mumbai and Pune are expected to approach optimal affordability, Kolkata is set to maintain its position as the most affordable major market. As residential sales continue to climb, India’s housing market is poised for a resilient and robust future, ensuring strong performance even in the face of rising prices.

Also Read: Oberoi Realty Reports Strong H1FY25 and Q2FY25 Results: Booking Value at ₹2,509.45 Crores; PBT Rises to ₹1,557.50 Crores

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Key Findings:

1. Price Trends and Demand Surge: The report highlights a notable increase in residential property prices in Panvel, with a rise of approximately 8-10% over the past year. This surge is attributed to the area’s growing popularity among homebuyers seeking affordable options with potential for high returns. The residential sector’s robust performance is also supported by increased demand for properties in emerging suburban locations.
2. Infrastructure Developments: Panvel’s appeal has been significantly bolstered by ongoing infrastructure developments. The anticipated completion of the Navi Mumbai International Airport and the extension of the Mumbai Metro Line 12 are expected to enhance connectivity, making Panvel an even more attractive destination for real estate investments.
3. New Project Launches: Developers are responding to the growing demand by launching several new residential projects. The report notes that there has been a marked increase in the number of new project launches in Panvel, reflecting the confidence of developers in the market’s potential. These projects are catering to a range of buyer segments, from affordable housing to premium residences.
4. Rental Market Insights: The rental market in Panvel is also showing signs of strength, with rental yields seeing a steady increase. This is in line with the broader trend of rising rental demand in suburban areas, driven by professionals and families seeking more space and better value compared to the congested city centers.
5. Future Outlook: The ANAROCK report provides an optimistic outlook for Panvel’s real estate market. The combination of improved infrastructure, rising property values, and the influx of new projects is expected to continue driving market growth. Investors and homebuyers are likely to find Panvel a promising area for future real estate ventures.

Also Read: Piramal Realty Unveils Phase One of Clubhouse at Piramal Revanta in Mulund

Conclusion: The Panvel Micro Market Report by ANAROCK underscores the area’s emerging status as a key player in Navi Mumbai’s real estate landscape. With its strategic location, ongoing infrastructure projects, and a healthy influx of new developments, Panvel is set to remain a hot spot for real estate activity in the coming years.

For more detailed insights, the full Panvel Micro Market Report is available here

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Annual Price Surge of 12%

The report highlights a significant annual growth in housing prices, with an average increase of 12% year-on-year (YoY) across the eight major cities. Delhi NCR recorded the highest YoY growth, with prices surging by 30%, followed closely by Bengaluru.

Quarterly Price Increases: Delhi NCR and Bengaluru Lead

Delhi NCR witnessed the highest quarterly price rise at 16%, driven by substantial price hikes in micro-markets such as Dwarka Expressway and Greater Noida. Bengaluru followed with an 8% increase in average housing prices. Notably, Delhi NCR’s luxury segment saw a considerable boost, with 3-4 BHK configurations experiencing up to a 12% QoQ price increase.

Unsold Inventory Declines Amidst Robust Demand

The report also notes a decrease in unsold inventory across most cities, reflecting robust sales activity. Kolkata experienced the highest sequential decline in unsold inventory at 5%, with Pune, Ahmedabad, and Chennai also seeing reductions. Despite these positive trends, MMR reported a slight increase in unsold units due to a surge in new launches.

Pune and Ahmedabad See Notable Reductions in Unsold Units

Pune stood out with the most significant annual drop in unsold inventory, falling by 13%. Ahmedabad and Chennai also reported a decrease in unsold housing units, with annual reductions ranging from 6% to 8%. This reduction indicates a healthy absorption rate in these markets.

Continued Growth and Market Dynamics

Boman Irani, President of CREDAI National, attributed the steady growth to strong homebuyer sentiment and ongoing positive market conditions. He emphasized that the festive season and government infrastructure initiatives are expected to further impact housing prices and inventory levels positively.

Badal Yagnik, CEO of Colliers India, noted that despite rising prices, demand remains robust, supported by stable interest rates and recent budgetary measures. He anticipates that the upcoming festive season will invigorate the housing market with increased sales and new launches.

Micro-Market Insights: Delhi NCR and Bengaluru

In Delhi NCR, Dwarka Expressway and Greater Noida saw impressive quarterly price increases of 35% and 24%, respectively. Bengaluru’s Inner East and Periphery & Outer East micro-markets reported notable price rises, with Inner East experiencing a 25% increase.

Outlook and Future Projections

Vimal Nadar, Senior Director and Head of Research at Colliers India, highlighted the strong demand in luxury and ultra-luxury segments, particularly for spacious units. The recent changes in long-term capital gains tax are expected to boost investor and homeowner sentiment, further supporting market growth.

As India approaches the festive season, industry stakeholders will closely monitor new launches and housing stock, anticipating continued momentum in the residential real estate sector.

Also Read: CIDCO to Launch Housing Scheme for 902 Flats on Krishna Janmashtami

The post Housing Prices Rise Across Top Indian Cities, Reports CREDAI-Colliers-Liases Foras appeared first on Square Feat India.

Key Findings:

• NCR Leads in Growth: The National Capital Region (NCR) has experienced the most significant growth, with average flat sizes soaring by 96% from 1,250 square feet in 2019 to 2,450 square feet in H1 2024. This surge is attributed to a boost in new luxury housing supply.
• Yearly Trends: Average flat sizes in the top seven cities have risen by 7% in the last six months, with the average size in 2023 being approximately 1,420 square feet.
• City Comparisons: NCR has the largest average flat size among the top cities, followed by Hyderabad at 2,010 square feet. Mumbai Metropolitan Region (MMR) has the smallest average size, with a modest increase of 5% over five years, reaching 825 square feet.

Detailed City Insights:

• NCR: The average flat size grew by 96% over five years and 30% in the past six months alone, reflecting a strong shift towards luxury homes. NCR saw the highest growth among the top cities, driven by increased supply in the luxury segment.
• Hyderabad: This city saw an 18% increase in average flat size over five years, rising from 1,700 square feet in 2019 to 2,010 square feet in H1 2024. However, Hyderabad experienced a 13% decrease in average flat sizes in the past six months.
• Bengaluru: Flat sizes increased by 27% over five years, from 1,280 square feet to 1,630 square feet. Between 2023 and H1 2024, Bengaluru saw a 10% rise.
• Chennai: Chennai’s average flat size grew by 32% over the last five years, reaching 1,450 square feet in H1 2024. In the past six months, it saw a 15% increase.
• Pune: Pune experienced a 21% increase in average flat size over five years, growing from 910 square feet in 2019 to 1,103 square feet in H1 2024. There was a slight 1% increase in the past six months.
• Kolkata: Kolkata’s average flat size rose by 13% in five years, reaching 1,125 square feet in H1 2024 from 1,000 square feet in 2019. The size remained relatively stable compared to 2023.
• MMR: MMR continues to have the smallest average flat size among the top cities, with only a 5% increase over five years, reaching 825 square feet. The region saw a modest 4% increase in the past six months.

Expert Commentary:

Santhosh Kumar, Vice Chairman of ANAROCK Group, commented on the trends: “The significant increase in average flat sizes, particularly in NCR, is largely driven by the rise in luxury apartment supply over the past year. Developers are responding to the heightened demand for spacious, high-end homes. This is a notable shift from the previous dominance of affordable housing in NCR, which has seen a steady decline in recent years.”

He added, “While MMR saw the least growth in flat sizes, the increase across other major cities highlights a broader trend towards larger homes. The preference for more spacious living environments persists despite rising prices and the end of pandemic-driven demand spikes.”

Market Implications:

The increase in average flat sizes across major cities reflects a shift in consumer preferences towards larger homes, despite rising residential prices. In NCR, the shift towards luxury housing has significantly impacted the average flat size, while other cities like MMR show minimal changes. This trend highlights ongoing demand for more spacious homes amid fluctuating market conditions.

Also Read: Real Estate Sector welcomes LTCG tax amendment

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