Housing Sector Witnesses Over 13% QoQ Growth in Aggregate Demand
Overall pan-India supply growth of 7.6 percent and price growth of 0.3 percent QoQ was observed in Q3 2021, says the Magicbricks PropIndex report.
The residential real estate sector is witnessing signs of recovery after experiencing serious economic repercussions caused by the pandemic. It is seeing a pan-India quarterly increase in demand of over 13 percent during the quarter, said the latest Magicbricks PropIndex report for the July-Aug-Sept 2021 quarter.
Further, the aggregate supply in the country jumped by nearly 8 percent Quarter on quarter (QoQ) during the period.
Peripheral locations continued to garner attention in Ahmedabad, Mumbai Metropolitan Region (MMR), Delhi NCR and Pune. In each of these cities prices witnessed a growth of 0.3 percent QoQ during this period displaying high resilience of the housing markets compared to other real estate classes in the country.
It is expected that this trend will continue for a few more quarters, until unsold inventories decrease significantly, as most developers are expected to focus largely on launching affordable and mid-range homes.
The real estate market of Delhi witnessed 29.1 percent QoQ growth in demand. Moreover, the under-construction properties saw a significant increase in prices QoQ in almost all price segments. On the other hand, Ready-to-Move properties did not see any major QoQ change in prices during the last 5 years due to limited demand for the existing properties.
In Bengaluru, the housing market saw mixed results as demand increased by 6 percent QoQ and supply decreased by 4 percent QoQ in Q3 2021. Given the relaxations in mobility and increase in business operations, the city saw more buying interest as developers attract new home buyers by offering pre-EMI option and 12 months payment holiday.
Hyderabad’s residential real estate, which remained resilient during the COVID-19 pandemic, saw both demand and supply increase by 3 percent QoQ each in Q3 2021. There is a growing preference for peripheral areas, which can be attributed to the various initiatives of the state government to launch housing schemes and e-auctioning of plots for office spaces, in the outskirts of the city.
Mumbai’s residential market witnessed a spike of 5 percent QoQ in demand after witnessing a steep decline of about 16 percent in Q2 2021. Further, Navi Mumbai and Thane witnessed spikes of 19 percent and 10.5 percent QoQ in demand respectively. The QoQ growth in demand was predominantly supported by the new supply in the market, which went up QoQ by 15 percent in Mumbai, 9 percent in Navi Mumbai and over 6 percent in Thane during the period.
The housing market in MMR is expected to pick up further due to the reduction in cases of COVID-19 and the ongoing festive season and prominent developers are preparing for new launches in the mid and affordable segments.
“With the festive season round the corner, the market is further expected to grow. There is more clarity in the minds of consumers who were earlier waiting to buy properties even as they waited for the pandemic to ease. These factors have brought optimism amongst developers as they prepare to announce several new launches,"said Sudhir Pai- CEO of Magicbricks.
Peripheral regions remained the epicenter of demand spurred by easing of restrictions, which helped to boost large scale economic activity and improve buyer confidence. This recovery can be attributed to factors such as reduction in guidance value, digitization of land records, housing schemes launched by the government and liquidity infusion through the SWAMIH fund, he said.
Source - www.moneycontrol.com
