After posting a strong performance in 2022, the luxury residential segment stayed on the high growth path in the first quarter of the new year, with the Delhi-NCR market hogging the limelight as a top performing region.
According to a report by Knight Frank India, post-pandemic uptick in ownership of luxury housing due to homebuyers’ preference for larger spaces with better amenities.continues through the new year., Delhi-NCR, Mumbai, Hyderabad, Pune and Kolkata have emerged as leading cities where maximum traction for high-end units was recorded. Sales in Delhi-NCR surged by over 216%, Mumbai by 44%, Hyderabad by 800%, Kolkata by 100% and Pune by nearly 13 times on a Y-o-Y basis for quarter ending Jan-Mar’ 23.
The report further highlights 12% Q-o-Q as well as Y-o-Y growth in overall sales of residential units (across all segments) during Jan-Mar’23 period.. A total of over 78,000 housing units were sold in Jan-Mar 2023 and about more than 81,000 units were launched during this period. Out of this, 49% share was recorded in the mid-end category followed by affordable/ budget projects. The Live, Work, Shop survey had earlier highlighted that more than half of Gen Z respondents planned to move to a new home in the next two years, compared to only 29% of baby boomers.
The past two years have seen a realignment in homebuyers’ priorities and the need for owning a house has been further accentuated due to the uncertainty that the pandemic ushered. Mumbai, Pune and Delhi-NCR had 62% cumulative share in sales of housing units in Jan-Mar’23. The report points out that Mumbai led in the number of total housing units sold at 19,000 units, followed by Pune (18,000 units), Delhi-NCR (11,600 units) and Bangalore (11,500 units). On the new launches front, the gateway cities – Mumbai (25,300 units), Pune (16,000 units) and Delhi-NCR (11,200 units) cumulatively accounted for about 64% share during Q1 2023.
Anshuman Magazine, Chairman & CEO – South East Asia, India , Middle East & Africa, CBRE, is of the opinion that the sales momentum of luxury housing is likely to continue in the coming quarters as well and projects with better
amenities, focus on health and safety and clean surroundings to further gain an edge amidst evolving consumer preferences.Talking of the residential outlook, the report notes that strong sales and launch momentum is expected in the first half of 2023; a minor tapering in activity likely in the middle of the year but its impact could be cushioned by the festive season.Capital value appreciation trends would vary on the basis of the segment, city / micro-market, unsold inventory levels and even project attributes; at the same time, developers likely to be cautious about raising prices lest it impacts homebuyers’ purchasing power.Projects in the higher ticket range (INR 1.5 crore and above) would continue to see traction in sales as the market has witnessed a spate of new launches in this bracket of late. Moreover, the impact of rising home mortgage rates would be limited on this segment.As large developers foray into tier-II cities, one would see a higher number of joint ventures and joint development initiatives as they strike partnerships with local players with an aim to manage regulatory hurdles and understand consumer preferences.