Residential housing sales hitting new peak in 2 years: Report

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The present increase in residential housing sales and launches is expected to reach a new peak by 2023, buoyed by strong pandemic ‘homeownership’ sentiments, according to a report in the Business Standard. The industry anticipates that the increase in demand, supply, and sales in the first three quarters of 2021 over the previous pandemic year would only continue. For example, according to ANAROCK Research, property sales in the top seven cities totaled about 145,650 units in the first nine months of 2021, from January to September. This represents a 5% increase over the 138,350 units sold in all four quarters of 2020, from January to December.

“As things stand now, we expect 2021 to be a year of recovery and steady development, setting the tone for a decade of aggressive momentum.” Fortunately, the current trend of demand exceeding supply is set to continue, with over 30% more house launches and 30-40% more sales expected in 2021 than in 2020,” stated Anuj Puri, chairman of the ANAROCK Group.

Puri predicted that by 2023, the housing market will reach a record high, with sales exceeding 317,000 units and new launches exceeding 262,000 units. With the real estate market (especially the residential space) experiencing peaks and troughs every six to eight years, the industry is primed for another round of peak, green shoots that are already visible in recent sales, launches, and realty firm financial performance statistics. At a recent conference organised by Credai Bank on 2021, HDFC chairman spoke about such a cycle.

Deepak Parekh claimed he had never seen better housing affordability in India than currently in his 50-year career, and that the real estate sector was on the verge of a new growth cycle.

“I have never seen such easy liquidity and interest rates at such historic lows.” Most importantly, I have never seen such a strong desire to acquire a home as I have witnessed in recent years. There is a lot of optimism in the air right now about the housing and real estate sector’s possibilities. “This isn’t just wishful thinking; it’s genuine,” Parekh remarked. Ashish Puravankara, MD, Puravankara Limited, who has forecasted housing market growth for the next five years, agrees with Parekh.

“All the current market forces indicate that residential real estate is positioned for sustained development over the next five years,” said Puravankara. However, while the momentum is expected to continue in alignment with the economic recovery, Gulam Zia, executive director, Knight Frank India told Business Standard that to sustain this demand, ‘governments, developers and financial institutions will have to look at renewed ways of keeping the interest amongst the end user rife’.

Research reports by other firms such as JLL India, Knight Frank and Jefferies show Q3 housing sales in 2021 till September being quite higher than the previous year. For instance, JLL India data saw that while in Q1 2021, sales of residential units increased by 17 per cent on a sequential basis but dropped by 23 per cent to 19,635 units in Q2 2021, sales have now continued on an upward trajectory in Q3 2021, increasing by 65 per cent on a sequential basis, recording 32,358 units.