Residential Market Update: Q4 2023

The residential sector saw record breaking sales in 2023 with 271,818 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%.

Premium segment (apartments priced above INR 1.5 crore) share in annual sales has increased from 19% in 2022 to 23% in 2023. Also, apartments priced less than INR 75 Lakh, has seen a perceptible decline in share. Delhi NCR and Mumbai have seen the maximum sales coming from the premium segment in 2023. Delhi NCR saw some prominent launches in the premium segment that were sold out completely within few days.

However, it is also pertinent to note that both mid-market (INR 50 Lakh-75 Lakh) and premium segments synergistically fueled 23% each of the sales momentum in 2023.

Residential launches in 2023 at 294,332 units were 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%. Interestingly, around 33% of the launches in 2023 were in the price bracket of above INR 1.5 crore.

Key Trends:

• In Q4 2023, residential market records the highest quarterly sales ever: The fourth quarter of the year saw stupendous sales with 75,591 units sold during the quarter, making it also the best performing quarter ever in terms of sales.
  
• In 2023, tech cities of Pune, Chennai, Bengaluru, and Hyderabad witnessed a remarkable growth in sales: The tech driven cities of Pune, Chennai, Bengaluru, and Hyderabad have seen impressive annual sales growth led by heightened sales activity in these markets. The demand was 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 pushed up the sales in these cities to a large extent.
• Mumbai, Pune, and Hyderabad account for 68% of the new launches: Around 68% of the new launches were recorded in Mumbai, Pune, and Hyderabad. Branded developers with healthy balance sheets have launched some prominent projects during the quarter. With an unchanged repo rate, a resilient supply pipeline from established developers, and steadfast land acquisitions. over the past year, the residential market stands poised for a positive trajectory in 2024.
• Unsold inventory declined by 1% Q-o-Q in Q4 2023: As of Q4 2023, unsold inventory across the seven cities declined by 1% on a Q-o-Q basis as sales outpaced new launches. Mumbai, Bengaluru, and Hyderabad together accounted for 65% of the unsold stock.