Housing sales increased by about 25% in seven major cities in the country in April, giving some hope that real estate sector may be on the revival path in the current financial year 2018-19.
As many as 1,726 units were sold in seven cities — Delhi-National Capital Region (NCR), Mumbai Metropolitan Region (MMR), Kolkata, Chennai, Bengaluru, Hyderabad and Pune — in April, as against 1,382 units in March.
This constitutes an increase of 25%. The Delhi-NCR witnessed a sharp rise in demand.
What has enthused the market is the fact that the sales in the first quarter (January to March 2018) also recorded increase, compared to the corresponding period last year. While 43,800 units were sold in last year’s quarter, this figure was 49,200 units this year.
According to a report by property consultant Anarock, the housing sales increased in all cities, except Pune and Kolkata last month. It said the upward trend was on account of positive consumer sentiments and favourable policies.
The report said the NCR market stole the show even on the sales front with a whopping 153% increase in April as against the preceding month. Bengaluru saw a 41% rise in housing sales, while MMR witnessed a 29% increase. Similarly, housing sales in Bengaluru increased to 278 units in April from 196 units in the previous month.
MMR saw sales of 516 units as against 399 units during the period.
In NCR, housing sales jumped over two fold to 243 units from 96 units. Sales in Chennai increased to 219 units from 113 units, while demand in Hyderabad rose to 234 units from 141 units.
However, sales dropped in Pune to 155 units from 182 units and also in Kolkata to 83 units from 255 units.
The new housing supply infusion was highest in the Delhi-NCR, followed by Hyderabad, Bengaluru and the MMR. Delhi-NCR saw a whopping 59% increase in its new housing stock in April as against the previous month.
Of the total new supply in April, about 43% was in the affordable housing category (less than Rs 40 lakh), followed by 33% in the mid segment (Rs 40 lakh–Rs 80 lakh), 11% priced in the range of Rs 80 lakh–Rs 1.5 crore and the remaining 13% in the segment priced above Rs 1.5 crore.
According to Anarock chairman Anuj Puri, the current trend indicates that the average size of properties is shrinking in most cities so as to meet the all-important “affordable budget” criterion. “For example, the average size of new launches in NCR was 1,853 sq. ft. in March 2018, and dropped to 1,323 sq. ft. in April. Bangaluru also followed this trend, with new launch property sizes shrinking from 1,300 sq. ft. in March to 1,160 sq. ft. in April,” he said.
“The younger buyers prefer to keep it small and avoid the maintenance hassles and costs of large homes. The high cost attached to maintaining bigger flats is another factor that is discouraging homebuyers from buying them. Since post-possession maintenance charges are calculated on their overall area coverage, smaller homes are very much in demand with younger buyers,” added Puri.
In fact, yearly trends also indicate a drop in the average new property prices across the top cities, barring Bangaluru, Hyderabad and Kolkata, which actually saw a marginal increase from 2017 till date.