Despite the rising property prices and geo-political tensions, the bull run continued in the Indian real estate sector in the first quarter of 2024. Numerous factors such as RBI’s recent monetary policies maintaining the repo rate, the persistent pursuit of homeownership, and positive sentiments among homebuyers in light of India’s GDP growth projections and controlled inflation are driving the ongoing sales momentum in the industry.
In the residential real estate, mid-range and luxury housing segment continued to rule the roost with around 76,555 units sold in the period (Q1 2024) – nearly 59% of overall sales share. In the last few months, the luxury housing market has seen a notable surge in India, reflecting the country’s growing penchant for opulence across various sectors.
As per the latest research report by Anarock, in the first quarter of 2024, out of 130,170 units sold in the top 7 cities, premium homes priced over ₹ 1.5 crore accounted for a noteworthy 21% share or around 27,070 units. In addition to this, over 28,020 luxurious apartments were launched in the Q1 2024, making up 25% of all new launches whereas affordable housing units witnessed a decline to 18%.
Affordable vs Luxury Housing – 5-Year Trend
If we take the stats of the last five years into account, in 2019, luxury homes recorded approximately 11% of the overall new supply across the top 7 Indian cities including Delhi NCR, Mumbai, Bengaluru, Pune, Hyderabad, Chennai and Kolkata. Fast forward to the first quarter of the ongoing year, this share has skyrocketed to 25%. In 2019, merely 25,770 units were launched in the premium market, but the scenario has immensely changed this year as in Q1 2024, a staggering 28,020 luxury homes were introduced.
Amid the rising demand for properties, Delhi-NCR dominated the luxury housing segment Q1 launches. In fact, NCR has emerged as an appealing destination for luxury homes, with sprawling mansions and fancy penthouses covered with lush green trees. Its real estate market provides a variety of premium developments that adequately satisfy the needs of discerning home buyers. Recently, an exceptional spike in luxury real estate deals has reflected the region’s growing affluence.
Affordable housing, on the other hand, has seen a huge reversal in the trend. In 2019, affordable units accounted for 40% of the overall new supplies, recording almost 2.37 lakh units across the major metropolitan cities. Although in 2024, a downtrend can be seen in the inventory of these units, plummeting to just 18% of total new launches.
What To Expect Next?
The Indian housing market is expected to remain buoyant in the upcoming quarters. As things stand now, all signs currently favour the residential market this year. This might lead to reaching another high in sales and new launches of luxury houses in 2024.
Despite the ongoing election fever in India, housing demand continues to be upbeat across several metro cities. Given the current scenario, homebuyers seem to be highly optimistic about the growth of the real estate market in the country.
Among the major factors favoring a new peak in 2024 including the fact that most real estate regulatory reforms and norms are already in place, the worst shake up caused by the pandemic is now behind us. Further, global corporations like the IMF have strong GDP growth predictions for India for the next few years. The Indian economy is growing at a significant pace and has a positive impact on the real estate sector.
