Residential real estate has managed to come back with sales surpassing pre-Covid levels, latest numbers by two leading real estate consultancies suggest.
According to JLL India, residential sales during Q1 2021 calendar year (CY) recovered to more than 90% of volumes witnessed in Q1 2020 across top seven cities, while launches were at 84% of Q1 2020 levels. Residential sales stood at 25,583 units in Q1 2021 against 27,451 in Q1 2020.
Similarly, Anarock Property Consultants said the housing sector in top seven cities staged an impressive comeback in January-March 2021 as sales increased 29% and new launches 51% during the quarter compared to the same period a year ago. Around 58,290 homes were sold in Q1 2021 as against 45,200 in Q1 2020, it said.
“Sustained growth in sales presents clear signs of demand and buyer confidence coming back to the market. This has been on the back of historically low home loan interest rates, stagnant residential prices, lucrative payment plans and freebies from developers and government incentives such as reduction of stamp duty in states like Maharashtra and Karnataka,” said JLL India’s chief economist Samantak Das.
The easing of lockdown restrictions and the vaccine rollout have further helped bring buyers back to the market, he said.
Another reason for the uptick in sales was the performance in the Mumbai Metropolitan Region (MMR), said Anarock Property Consultants chairman Anuj Puri. MMR and Pune were the most active in Q1 2021 since the limited-period stamp duty cuts and other sops and discounts substantially reduced acquisition cost.
“MMR’s homebuyers have responded proactively to the bottomed-out property prices in the country’s most expensive real estate market. This is adequately vouchsafed by the significant rise in property registrations in Mumbai in the first two months of the year,” he said.
Both consultancies also pointed out the healthy traction in demand for apartments in the mid-income segment, which along with affordable housing, has emerged as the mainstay for residential real estate.
“Mid-segment homes (Rs 40-80 lakh) comprised a 43% share of the total new launches (62,130 units), followed by affordable housing with a 30% share,” Anarock said.
JLL India said the focus on the mid- and affordable segment continued in Q1 2021 with nearly 70% of the new launches (33,953 units) in the sub-Rs 10 million (Rs 1 crore) category.
On prices, Anarock said most of the top seven cities recorded a rise of 1-2% in average property prices this quarter over Q1 2020. In Kolkata, however, prices remained stagnant.
JLL India said, “As developers continue to focus on recovering the volumes lost amidst the pandemic and gaining a foothold in their respective markets, prices are expected to be largely range-bound across most of the markets in the short-term.”