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Third quarter points to a quick rebound: Housing sales up 12% YoY in Jan-Sep across 8 cities: PropTiger.com

Bengaluru, Nov 16, 2021: Housing sales have increased by 12 per cent to 1,38,051 units during January-September period of the current calendar year from 1,23,725 units in the corresponding period of 2020 as per the recent report ‘Real Insight residential Q3 2021 by online housing brokerage firm, PropTiger.com’.

“Driven by pent up demand and festive sales as well as gradual recovery in the Indian economy, improved job market and low interest rates, housing sales are likely to rise by 15-20 per cent above 2020 level during the current calendar year despite the strong second wave of the COVID pandemic”, said Rajan Sood, Business Head, PropTiger.com

However, Sood added, “despite the revival in the residential real estate market, housing sales might still fall short of 2019 numbers. A lot is dependent on sales numbers in the ongoing quarter”.

In the 2020 calendar year, sales plunged 47 per cent to 1,82,639 units from 347,586 units in the previous year, mainly because of the nationwide lockdowns during April-June last year.

“We are seeing heightened property search activity on Housing.com which points towards a positive turnaround for the residential real estate market for 2021. Reflecting the optimism in the sector, Housing.com’s IRIS index, which is a leading indicator to assess the upcoming residential demand in the country, closed at an all-time high in September of this year”, said Ankita Sood, Director and Head of Research, PropTiger.com, Housing.com & Makaan.com.

Sood also added, “In case of Bengaluru, the online high-intent homebuyer activity in the city is already 90% closer to the historical peak of March 2021. Most of these property searches are concentrated in prominent commercial and residential locales such as Krishnarajapura, Whitefield, Varthur and Electronic City.”

The demand drivers over the last one year have been — low interest rates on home loans, stable housing prices in the last few years, discounts & special offers from builders to speed up liquidation of their stocks and stamp duty reduction by various state governments including Karnataka wherein the state has reduced the stamp duty on property priced between Rs.35 lakh and Rs 45 lakh to 3% from the earlier 5%.

The adoption of work from home policy has also led to rise in housing demand. The belief in home ownership has gained momentum, even among young millennials who earlier were reluctant to buy homes, preferring the flexibility offered by shared living.

After the outbreak of the pandemic, the consolidation of housing demand towards big, listed and reputed developers has gained momentum. This is getting reflected in their quarterly sales bookings numbers.

Prices:

“As per our estimates, housing prices will remain stable although there is upward pressure because of rising input costs. Some branded developers have raised prices, albeit marginally, to offset increase in input costs”, added Rajan Sood.

The demand is largely driven by end-users in affordable and mid-income segments, but luxury properties are also not lagging behind.

Supply:

New launches have more than doubled to 1,40,087 units during January-September 2021 from 68,097 units in the year-ago period. Fresh supply has already crossed the annual figures for 2020 that saw total new launches at 1,22,426 units across eight cities.

During 2019, total launches were 2,44,254 units.

Bengaluru market:

During January-September period of this calendar year, housing sales in the IT city fell marginally to 15,569 units from 15,798 units during the corresponding period of the previous year.

Housing sales in Bengaluru fell to 23,458 units in 2020 from 38,733 units in the previous year.

New supply in Bengaluru rose to 12,015 units during January-September from 11,689 units in the year ago period.