Surging demand, soaring sales to keep real estate under arc lights in 2024

India’s housing market defied logic this year to register all-time high sales as home buyers snapped up deals despite a jump in asking prices and the highest interest rates in six years.

Market experts strongly believe the demand will not only sustain in 2024 but rise further, albeit at a slower pace, on high economic growth and expectations of a fall in home loan interest rate.

The real estate industry saw record sales of residential properties in terms of both volumes and value, real estate market data showed as consumers are increasingly buying into the idea of home ownership post pandemic.

RERA boost

The ouster of dubious developers from the real estate market thanks to greater regulatory oversight via RERA helped boost confidence among home buyers. The insolvency law, too, has played a role in elimination of defaulting builders.

According to real estate consultant Anarock, housing sales are estimated to rise by 30% this year to a record 4.74 lakh units in primary (fresh sales) markets of the top seven cities — Delhi-NCR (National Capital Region), Mumbai Metropolitan Region (MMR), Chennai, Kolkata, Bengaluru, Hyderabad and Pune.

In value terms, the sales of residential properties are seen at a whopping ₹4.5 lakh crore, supported by higher ticket prices.

Housing prices, which started rising from last year after remaining stagnant for almost a decade, continued an upward trend and appreciated by an average 14% this year, encouraging investors to return to the primary residential market.

“The changing sentiments of homebuyers — wherein not only are home-renters converting into buyers but also buying bigger homes — has played a huge contributing hand to sectoral and economic growth. The consumer has realised the importance of owning a home and we expect this sentiment to continue in the foreseeable future,” realtors’ apex body CREDAI President Boman Irani told PTI.

Property developers and consultants are of the opinion that the industry is witnessing the ‘best time’ and it is possibly in the first or second year of long-term upcycle.

Sales were strong across price brackets, be it affordable, mid-income, premium and ultra-luxury homes, but what surprised everyone was the huge demand for properties starting from ₹3-4 crore range to as high as ₹100 crore.

“The Indian residential real estate sector experienced remarkable growth in 2023, reaching a pinnacle not seen in the past 15 years. On the back of a strong Indian economy, real estate sector is seeing this robust end user-led growth in the residential demand and supply,” Anarock’s Chairman Anuj Puri said.

He expressed confidence that the market will grow further next year.

“Given the ongoing developments and sustained momentum in the economy and residential real estate sector, the upcoming year is poised for continued growth, although the rate of increase may be more moderate due to high base effect,” he said.

Sales are expected to surpass supply or maintain equilibrium,…