The festive season in India is round the corner and developers and stakeholders usually wait for this auspicious period to get a much-needed boost in sales. After a sustained growth, the Indian real estate market has witnessed a noticeable slump in both home sales and new project launches in the past few months. That’s why all eyes are now on the upcoming festive season which could revive the momentum in the property market.
In the post-COVID, when the real estate industry in India gradually started to recover, the sales of residential properties also increased, reaching its peak in 2023 across all the top cities. This growth trajectory hit a setback when the residential sales dropped for the first time in two years in April-June period this year. It further declined in the September-ended quarter.
According to data released by PropEquity, on a Year-on-Year (YoY) basis, home sales dropped by 18% in the July-September period across major property markets, barring the Delhi-NCR region. This can be happened due to various reasons and one of them is an all-time high record during January-March quarter 2024. The steady hike in property prices prompted potential buyers and investors to take a breather.
How Does A Drop In Launches Impact Home Sales?
There is no denying the fact that project launches are important to boost the home sales in the realty sector. So, whenever there is a decline in fresh launches, it instantly hits the property sales. In 2024, in the July-September period, residential project launches dropped by 11% as compared to the same quarter in 2023. Only the National Capital Region (NCR) and Mumbai Metropolitan Region (MMR) saw a surge, while the other metro cities saw a steep fall. Cities like Kolkata and Hyderabad witnessed the sharpest drop in launches this year.
For the financial year 2024-25, renowned developers have set up an aggressive launch schedule, which would be critical to achieve their higher sales targets. So far, approval difficulties have caused most of the delays in launches, which have been postponed or moved to the upcoming months.
Why Is Festive Season So Important?
Be it in the residential segment or the commercial one, property transactions usually see a spike over the holiday season. This season begins with Navratri and continues till Diwali and the New Year. Further, several Non-Resident Indians (NRIs) also invest in properties at time of the year to get better deals. For developers, Diwali season is the best time to launch new projects as it is considered auspicious in India.
What Can Be Expected From Diwali 2024?
In the upcoming December quarter, numerous project launches are anticipated, many of which were originally scheduled for the festive season but have been delayed due to pending approvals. Many real estate firms are likely to introduce a range of incentives, such as price discounts, flexible payment plans, and additional perks. Banks are also expected to offer benefits like reduced mortgage rates and lower processing fees. Additionally. major developers, including DLF and Prestige Group, are set to unveil significant new projects in the coming months.
In conclusion, the two-quarter sales slump could be just a blip in the Indian housing market that is otherwise stable. As long as the gap between launches and property sales is not too wide, it is not a big concern.
In 2025, the top four developers (DLF, Godrej Properties, Macrotech Developers, and Prestige) are collectively aiming for ₹88,000 crore sales, up from ₹73,000 crore in 2024. Therefore, after a subdued period of sales in the property market, builders now have a chance to make the most of this festive season and change the momentum again.
