Housing sales in eight major cities increased marginally by 4 per cent to 1.29 lakh units during the first half of this calendar year, largely driven by rise in demand of affordable homes, according to property consultant Knight Frank.
The supply of new homes rose by 21 per cent to 1.11 lakh units during January-June 2019 from 1.24 lakh units in the year-ago period, the consultant said.
Knight Frank Tuesday released its half-yearly report - 'India Real Estate' that tracks demand, supply and prices of residential and office properties in eight cities -- Delhi-NCR, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad, Pune and Ahmedabad.
Housing sales increased to 1,29,285 units from 1,24,288 units, while new launches rose to 1,11,175 units from 91,739 units during the period under review.
Unsold inventories lying with the developers dropped by 9 per cent to 4,50,263 units.
"The India sales improved by 4 per cent in H1 2019 making this the third consecutive quarter to record sales improvements," said Knight Frank India Executive Director (North) Mudasir Zaidi told reporters here.
More From This Section
The trends conclusively show a general arrest of a declining trend that can well be the inflection point leading to growth of sales in the market, Zaidi said.
According to the data, NCR saw maximum increase in demand with sales rising by 10 per cent at 19,852 units during the first six months of this year, followed by Bengaluru with 9 per cent increase at 28,225 units.
Housing sales in Pune were up by 6 per cent at 17,364 units, 5 per cent in Chennai at 8,979 units, 4 per cent in Mumbai to 33,731 units, 2 per cent in Ahmedabad at 8,212 units. Demand was flat at 8,334 units in Hyderabad.
However, sales declined in Kolkata by 30 per cent to 4,588 units. This is primarily due to the procedural delays caused by the West Bengal Housing Industry Regulatory Authority and the pronounced dependence of developers on the distressed non-banking financial company (NBFC) sector.
"The concerted efforts by the government and the incentives given have resulted in substantial demand in affordable housing which has resulted in an overall boost to residential sales. This also seems to be in line with the government vision for 'housing for all'," said Shishir Baijal, CMD, Knight Frank India.
The weighted average prices have stagnated across cities with Mumbai, Pune and Chennai seeing prices fall by a further 3 per cent, 4 per cent and 3 per cent year-on-year (YoY), respectively.
Hyderabad continues to see exceptional price growth at 9 per cent YoY due to the high proportion of ready inventory and very little supply coming online during 2018.
During the last four years, the growth in residential prices in most of the top eight cities of India has been below retail inflation growth and the gap has progressively increased since H1 2016.