Residential sales in top seven cities up 68% year-on-year in 2022: Report

NEW DELHI: According to a recent JLL India report, the residential sector experienced a robust demand revival in 2022, with the year having to register a decadal high in-home sales with 215,000 units across the top seven cities of Mumbai, Delhi-NCR, Bengaluru, Hyderabad, Chennai, Kolkata, and Pune.

Residential sales increased by 68% year on year (y-о-у) in 2022, with more than 50,000 units sold in each of the four quarters. Bengaluru and Mumbai led annual sales in 2022 with over 46,000 units (22% share each), followed by Delhi NCR with 38,000 units (18% share).

Quarterly sales (October-December) increased by 16% in Q4 2022 over Q4 2021. However, it was down 5% sequentially due to a cautious approach and delayed decision-making by prospective home buyers in the final month of the year due to global headwinds and uncertainty in economic conditions.

“The massive sales volumes in H2 2022 prove that sales were still rigorous despite recent challenges, trying to highlight the strength of India’s residential market and the increasing significance of home ownership post-pandemic. The Indian residential market is expected to maintain its growth momentum in 2023, despite global headwinds and higher interest rates “JLL managing director and head (Residential Services-India) Siva Krishnan said.

Bengaluru and Mumbai have a combined 21% share of quarterly sales, while Pune has an 18% share.

Almost half of the sales in 2022 came from apartments priced between Rs 75 lakh and Rs 75 crore. The sales momentum also remained strong in the premium segment, with apartments priced at Rs 1.5 crore or more accounting for 19% of total sales in 2022.

The proportion of apartments priced below Rs 50 lakh in total annual sales has fallen from 28% in 2021 to 22% this year. On the other hand, the premium segment’s share (prices above Rs 1.5 crore) has increased from 10% to 19%.

Residential prices in India’s top seven cities have risen by 4-11% year on year, while home loan interest rates have risen by around 200 basis points in the last 7-8 months. Prices are rising across the board for projects with high demand and limited ready-to-move inventory. Existing project phases are also being launched at higher prices.

The number of new launches in 2022 increased by 81% year on year. The majority of the launches (26%) took place in Mumbai, with Hyderabad coming in second (22%). Bengaluru and Pune each had a 20% share. More than 40% of the new launches were priced between Rs 75 lakh and Rs 1.5 crore. In the year, premium segment apartments priced above Rs 1.50 crore accounted for a sizable 21% share.

Unsold inventory in the seven cities increased by 1.8% year on year in Q4 2022, as new launches outpaced sales. Mumbai, Bengaluru, and Hyderabad account for 63% of the unsold inventory. Years-to-sell (YTS) analysis reveals that the expected time to liquidate the stock has decreased from 3.1 years in Q3 2022 to 2.9 years in Q4 2022.