Homes Prices Above Rs 1 Crore See Highest Sales in India During January-March 2024: Report

India’s residential market in 2024 so far has witnessed a sustained momentum with sales growing at 9 per cent year-on-year (YoY) during January-March 2024, according to a report by Knight Frank. The surge in sales was remarkable 259 per cent YoY in the housing segment above Rs 1 crore.

“Sales volumes in the primary market have grown at an annualised rate of 29 per cent since 2020, that culminated in a 10-year high in 2023. India maintained its position as the fastest-growing major economy, with a steady outlook on interest rates by the close of 2023. Stepping into 2024 the Indian residential market has sustained its momentum with sales growing at 9 per cent YoY in Q1 2024,” Knight Frank said in the report.

Mumbai witnessed the highest sales volume and YoY growth, with 23,743 units sold in Q1 2024, marking a 17 per cent increase from the preceding year. The surge was predominantly driven by a remarkable 259 per cent rise in the sales of units priced above Rs 1 crore compared to the corresponding period in the previous year (Q1 2023), it said.

Sales volumes in Hyderabad grew by 15 per cent YoY, followed by Pune at 14 per cent YoY during the quarter, the report added.

In terms of launch, a total of 93,254 new residential units were launched in Q1 2024 registering a growth of 7 per cent YoY. Kolkata experienced the most significant growth in units launched, with a YoY increase of 89 per cent, reaching a record high for the market with 6,021 units launched, it said.

“Sales were prominently skewed towards the Rs 10 million (Rs 1 crore) price segment. The current QTS level of 5.9 quarters which is significantly better than the 6.7 level a year ago, signifies that the overall market traction has improved despite the increase in unsold inventory levels,” according to the report.

The fundamental structure of the market has undergone significant changes, with the higher ticket sizes accounting for the majority of sales, while volumes in the Rs 50 lakh segment have decelerated consistently.

Houses Between Rs 50 Lakh and Rs 1 Crore

Sales in the Rs 5-10 million segment witnessed a drop of 6 per cent YoY in Q1 2024, as homebuyers’ focus shifted to the higher priced category during the quarter.

“The drop in this segment’s sales can be viewed as a normal correction in a long-term upward trend. Bengaluru (6,065), Mumbai (5,815), and Pune (5,399) together accounted for more than 60 per cent of sales in the ticket size between Rs 5 million to Rs 10 million. The QTS levels for this segment stand at 4.9 quarters,” it said.

Houses Below Rs 50 Lakh

The share of sales in the Rs 5 million (Rs 50 lakhs) and below ticket size has also declined by 10 per cent YoY with sales of 25,714 units in Q1 2023 to 23,026 units in Q3 2023. The current sales share of 27 per cent is a far cry from the 41 per cent levels in Q1 2022, according to the report.

“The combined impact of rising prices, higher home loan rates, and the relatively adverse effects of the pandemic in this sector persisted, suppressing demand,” it said.