Knight Frank India, in its latest report, India Real Estate: H2 2019, observed that despite headwinds of economic slowdown, Indian real estate sector has recorded an overall growth in 2019. The residential segment in top eight cities of India demonstrated unexpected resilience and recorded a marginal growth of 1% year-on-year (Y-o-Y) in sales volume in 2019. Total sales volume was recorded at 245,861 units in 2019 over 242,328 in 2018 as affordability improved, and developers aligned themselves with the needs of home-buyers by reducing ticket-sizes and unit-sizes in a bid to encourage sales. New residential unit launches rose by 23% Y-o-Y in 2019 to be recorded at 223,325 units. The office market recorded its historic best year in terms of transaction volumes in 2019, recording 60.6 million square feet (msf), backed by a surge in leasing activity by the Information Technology segment. New completions surged by 56% in 2019 and was recorded at 61.3 msf, marginally surpassing demand.
Home launches across the top eight cities in India grew by a robust 23% to 223,325 units in 2019. The growth in launches was more pronounced in H2 2019, at 25% to 112,150 units. 61% of launches in H2 2019 occurred in ticket sizes under INR 5 million (INR 50 lakh) and 81% under INR 10 million (INR 1 crore) as developers focused on affordable housing and lower ticket sizes. Mumbai saw the highest number of homes launched in 2019 at 79,810 units, followed by Pune at 44,660 units, and Bengaluru at 33,772 units.
Aggregate annual sales across the top eight cities stayed stable and rose by a marginal 1% to 245,861 units in 2019 as regulatory and financial interventions helped keep sales from deteriorating further. Developers' focus on right-sizing and right-pricing of new residential products and greater transparency due to increased regulation, has led to a steadying of annual and half-yearly sales numbers. H2 2019 experienced similar flat sales growth at a marginally lower 1% YoY to 116,576 units. Unsold inventory across the top eight markets improved in 2019, registering a 5% decline to 445,836 units. Mumbai had the highest quantum of unsold inventory at 145,301 units, followed by NCR at 122,084 units and Bengaluru at 78,414 units.
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