Residential sales: Rs 1 cr + homes lead market, constitute 46% of all sales

The need for larger living spaces and an upgraded lifestyle which was sparked during the pandemic continues to fuel demand in this segment, it added. 

“Consistent with the upward trend seen in the past 13 quarters, the high-end segment of Indian residential real estate  ticket size INR 10+ mn, has grown significantly to 46% of all sales in in Q3 2024 as compared to 35% a year ago.  Sales in this segment have grown by 41% YoY and it has been the primary driver for overall sales growth during the quarter,” said Knight Frank India in a statement. 

However, the share of sales in mid-size segment has moderated, while affordable segment continues to witness a downtrend. Units priced between Rs 5-10 million category accounted for 30% share of total sales with 26,011 units sold, followed by units under Rs 5 million with 24% market share and sales of 20,769 units in Q3 2024. 

While home prices have increased across cities,  Bengaluru has seen the sharpest rise at 10 per cent year on year. 

Mumbai witnessed the highest sales volume and YoY growth, with 24,222 units sold in Q3 2024 and marking a 9% increase from the preceding year. 

The residential sales in Bengaluru (14,604 units) and Pune (13,200 units) have surpassed sales of NCR’s residential market in Q3 2024.

NCR is the only residential market to record a de-growth of (7%) in sales. “NCR has historically been among the more speculative markets with a relatively higher quantum of investment interest. This coupled with very low inventory levels in mid and affordable categories in the right locations, have weighed down sales in the market,” noted the report. 

Key Findings:

• 
  The premium segment has seen a significant increase in demand, surpassing the mid-segment and budget segment.
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  Residential prices have appreciated across all eight leading markets, with Bengaluru witnessing the sharpest rise at 10% YoY.
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  Mumbai, NCR, and Bengaluru together account for 80% of total sales in Q3 2024.
• 
  Total residential sales increased by 5% YoY to 87,108 units in Q3 2024.
• 
  Homes priced over Rs 10 million accounted for 46% of total sales, growing by 41% YoY.
• 
  Mumbai recorded the highest sales volume, followed by Bengaluru and Pune.
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  Sales in the mid-segment (Rs 5-10 million) declined by 13% YoY.
• 
  The affordable segment (under Rs 5 million) faced challenges due to rising prices and limited supply.
• 
  A total of 90,479 new residential units were launched in Q3 2024, with Pune leading in terms of new launches.
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  Residential prices appreciated in all eight leading markets, with Bengaluru witnessing the sharpest rise.

“The real estate market has experienced another exceptional period characterised by robust performance in the residential sector. The Rs 1 crore and above segment continues to fire on all cylinders and remains the primary driver of overall sales growth. NCR was the only residential market to see a decline in this quarter and yet for the past 13 quarters, high-end properties in the NCR region (INR 10+ mn) have consistently surged, accounting for 46% of all sales in Q3 2024, up from a year ago. Given the steady economic outlook and the likelihood of rate cuts, we believe that demand has enough tailwinds to sustain current momentum as the market approaches the end of the year,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India.

Factors Driving Growth:

• 
  Low interest rates have made homeownership more affordable.
• 
  A positive economic outlook has boosted consumer confidence.
• 
  The pandemic has accelerated the trend towards larger living spaces.
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  Developers are focusing on building premium projects to cater to the growing demand for high-end properties.

First Published: Oct 03 2024 | 3:37 PM IST