Looking at the trend of residential house prices, it has been a sluggish trend for a long period. After the corona epidemic, the demand for private property showed increasing. After this, residential real estate prices started rising across the country. Real estate developers are said to be under increased pressure to complete residential projects quickly. However, the main reason for the hike in prices is the cost of construction materials, the recent hike in interest rates by the RBI.
fastest growth in chennai
Data from PropTiger.com shows that Chennai, the capital of Tamil Nadu, one of India’s most active real estate markets, saw the fastest increase in prices between January and March 2022. From there the prices have gone up by eight to 10 per cent. According to the ‘Real Insight Residential Report January-March 2022’, prices of residential properties have increased in eight major cities of the country. It says that this increase in prices is likely to continue in the coming months and quarters as well. According to the report, the demand has increased in several segments across various major cities of India and developers are also making efforts to provide affordable and mid-segment homes to prospective home buyers.
Sales are increasing
Talking about the whole of India, 70,623 units have been sold in the first quarter of the financial year 2022, while 66,176 units were sold in the first quarter of 2021. Thus an increase of 7 per cent. Talking about the improvement in the supply of new units during the same period, it has improved at the rate of 50 per cent per annum. A total of 79,532 units were launched in the first quarter of FY 22, while 53,037 units were launched in the first quarter of FY 21.
Which houses have increased demand
It is also clear from the demand data that a large number of buyers are preferring residential homes in the range of Rs 45-75 lakh. Mumbai and Pune contributed the most to home sales, with both cities contributing 56 per cent of the total during the period. Another important factor that points to an improvement in the demand for under-construction properties is the change in preference. Unlike in the past, now home buyers are again taking interest in under-construction properties. This is because it fetches lesser price than a ready-to-move asset. Earlier most of the buyers used to opt for ready-to-move properties due to lack of trust. But now gradually the confidence of the buyers is increasing in the developers and the developers are also trying to deliver on time. As a result, many developers, especially well-known developers, have been able to sell their under-construction units as well.
Unsold inventory became trouble
A large number of unsold housing inventories from various developers continue to be a cause of concern for developers. However, the reason for this is also the excess supply of units at wrong prices. Delhi-NCR has the highest unsold inventory among various cities. Whereas Bangalore and Kolkata have the lowest. Now this inventory is gradually decreasing as the graph of residential real estate has started moving upwards.
Which cities were included
The ‘Real Insight Residential Report January-March 2022’ details the developments in the residential realty sector in Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, Mumbai Metropolitan Region, Delhi-NCR and Pune.