The residential sector saw record breaking sales in 2023 with 271,800 units across the top seven cities of India (Mumbai, Delhi NCR, Bengaluru, Hyderabad, Chennai, Kolkata, and Pune). In fact, 2023 has become the best year for the residential market as it surpassed the previous peak of 2010 by 25%. On a y-o-y basis as well, 2023 sales were up by 26%, with every quarter performing better than the previous one. The fourth quarter of the year saw stupendous sales with 75,500 units sold during the quarter, making it also the best performing quarter ever.
The tech driven cities have seen impressive annual growth led by heightened sales activity. “The tech cities of Pune, Chennai, Bengaluru, and Hyderabad witnessed a remarkable growth in sales as compared to the previous year. The significant upside in the sales in 2023 reflects the innate potential of these markets. The demand is primarily driven by an increasing return to office in the IT/ITeS sector and expansion of global firms and Global Capability Centres (GCCs) along with setting up of new ones. In addition, the quality supply brought in by prominent developers has pushed up the sales in these cities to a large extent.”. said Dr Samantak Das, Chief Economist, and Head Research & REIS, India, JLL
It is also pertinent to note that premium segment (apartments priced above INR 1.5 crore) share in annual sales has increased from 19% in 2022 to 23% in 2023. Infact the premium segment has also emerged as a leader in terms of absolute apartment units sold during the year surpassing every other price segment. Also, apartments priced less than INR 75 Lakh, has seen a perceptible decline in share.
In 2023, there has been a rise in residential prices across the top seven cities of India in the range of 4-16%y-o-y. Bengaluru has seen the maximum rise to the tune of 16% followed by Delhi NCR at 12%. The increase in prices is seen across the spectrum of projects that have high demand and less ready-to-move inventory. New phases of existing projects are also getting launched at higher prices.
Highest ever New Launches recorded in 2023.
Residential launches in 2023 at 294,330 units are the highest ever surpassing the previous high of 281,000 units in 2010. Compared with the previous year, new launches in 2023 witnessed a growth of 19% y-o-y.
Developers have realigned their marketing strategies based on the current market dynamics, and this is clearly getting reflected in increasing number of launches in the higher ticket size projects. Around 33% of the launches in 2023 were in the price bracket of above INR 1.5 crore.
On a y-o-y comparison, larger residential markets of Delhi NCR and Bengaluru saw a decline in their unsold inventory levels by 19% and 16.8%, respectively.
An assessment of years to sell (YTS) shows that the expected time to liquidate the stock has declined by 8 months from 2.9 years in Q4 2022 to 2.1 years in Q4 2023, an indication of robust sales growth.