Newsblare

Top 50            Stocks to Buy

Real Estate

41% of New Housing Supply in Top 7 Cities Sold in Q1 2023, from 26% in Q1 2019

New Housing Supply in Top 7 Cities Sold
  • Of approx. 1.14 lakh new housing supply sold across the top 7 cities in Q1 2023, over 41% were fresh launches; in same period 2019, of approx. 78,520 units sold, 26% were newly launched.
  • Among the top cities, Hyderabad saw highest absorption of fresh supply – of approx. 14,280 units sold in Q1 2023, approx. 46% was in fresh launches while in 2019 the share was just 28% (of total 5,400 units sold)
  • At 30%, NCR had the lowest share of fresh supply absorption out of total 17,160 units sold in Q1 2023
  • End-user confidence in branded supply aside, increasing fresh supply absorption also indicates rising investor activity

Mumbai, 31 May 2023: While ready-to-move-in homes still top the wish-list of most home seekers in the top 7 cities, newly launched units are gaining increasing acceptance. This traction has been building up ever since branded developers started cornering the fresh supply market with projects that elicit buyer confidence and have all the features they seek. Latest ANAROCK Research data shows that out of approx. 1.14 lakh homes sold in Q1 2023 across the top 7 cities, over 41% were in newly launched projects.

Notably, the sales share of newly launched was much lower in corresponding period of 2019, when just 26% of approx 78,520 sold homes were in new projects. In Q1 2022, of approx. 99,550 new housing supply sold in the top 7 cities, 36% were launched during the same quarter.

New Housing Supply in Top 7 Cities Sold

Among the top 7 cities, Hyderabad accounted for the highest sales share of new units. Of approx. 14,280 units sold there in Q1 2023, approx. 46% were launched in the same period. NCR saw the lowest absorption of newly launched homes – of 17,160 units sold in Q1 2023, just 30% were launched during the quarter. The remaining units sold were in projects launched before Q1 2023. However, NCR has seen remarkable change in the given period.

Anuj Puri, Chairman – ANAROCK Group, says, “For the longest time, ready-to-move-in homes remained in highest favour with homebuyers because of the previously abysmal project completion track record in many areas of the country. This is now changing – under-construction homes in new launches are increasingly finding takers, though ready-to-move homes retain the top demand slot.”

There are two reasons for this, explains Puri. “Firstly, much of the new supply is by well-funded branded developers who will comply with RERA regulations and complete their projects as per schedule. In Q1 2023, of 1.14 lakh new units launched in the top 7 cities, the branded vs non-branded developer share ratio stood at 59:41 while back in 2015, it was the reverse at 41:59. Secondly, investors are back on the housing market. Early-stage under-construction homes offer the kind of cost arbitrage that make residential real estate attractive to investors, who has largely given housing a miss over the last 3-4 years. It is a heartening trend for the residential market in remaining 2023.”

This trend bears watching, as it has strong mid-to-long-term implications for the Indian residential property market. While the return of investors is positive for overall sales, an end-user driven market helps keep prices in check. Accelerated investor activity has historically led to unreasonable price hikes which eventually throttled back the overall housing market growth story.  

City-wise Absorption Trends

At 30%, NCR saw the lowest sales share of newly launched units in Q1 2023. Another city with comparatively low fresh supply absorption share is Kolkata at 32%. Interestingly, MMR, which saw the second lowest absorption of newly-launched units in Q1 2019 with a 24% share, saw its sales share of new units jump to 40% in Q1 2023.

 Q1 2023Q1 2019
CityTotal Units Sold% Share of New Launch AbsorptionTotal Units Sold% Share of New Launch Absorption
NCR17,16030%13,74021%
MMR34,69040%24,01024%
Bangalore15,66043%15,58028%
Pune19,92045%12,34035%
Hyderabad14,28046%5,40028%
Chennai5,88041%3,43029%
Kolkata6,19038%4,02024%
Total1,13,78041%78,52026%
Source: ANAROCK Research
  • In MMR, of 34,690 units sold in Q1 2023, approx. 40% were fresh launches. In same period 2019, of 24,010 units sold, 24% were in new units
  • In NCR, of 17,160 units sold in Q1 2023, approx. 30% were launched in the same quarter. In Q1 2019, of 13,740 units sold, the sales share of newly launched units was lower at 21%
  • In Chennai, of 5,880 units sold in Q1 2023, newly-launched units accounted for a 41% share – up from 29% of 3,430 units sold in Q1 2019.
  • In Kolkata, of 6,190 units sold in Q1 2023, over 38% were newly-launched. In Q1 2019, approx. 4,020 units were sold, of which 24% sales were of newly-launched units
  • In Bengaluru, of 15,660 units sold in Q1 2023, the sale share of newly-launched units was 43% – up from 28% of 15,580 units in Q1 2019
  • In Pune, of 19,920 units sold in Q1 2023, the sale share of newly-launched units was 45% – up from 35% of 12,340 units in Q1 2019. The city saw the second highest sales share of new launched units after Hyderabad.
  • Hyderabad had the highest sales share of newly-launched units among the top 7 cities. Of approx. 14,280 units sold in Q1 2023, 46% were launched in the same period – significantly up from 28% of approx. 5,400 units in Q1 2019.

Also Read:

CEO & Editor
I'm Ved Prakash, Founder & Editor @Newsblare Media, specialised in Business and Finance niches who writes content for reputed publication such as Investing.com, Stockhouse.com, Motley Fool Singapore, etc. I'm the contributor of different... news sites that have widened my views on the current happenings in the world.

2 Comments

Leave a Reply

Your email address will not be published. Required fields are marked *