New projects account for 41% housing sales in Q1CY23 in top 7 mkts: Anarock

Share of newly launched homes was much lower in the same period of CY19, with just 26% homes sold in new projects out of about 78,520 units

While ready-to-move-in homes are still the preferred choice of most homebuyers, newly-launched units are also gaining traction. Of about 114,000 homes sold in the first quarter of this calendar year (Q1CY23) across the top 7 cities, over 41 per cent were in newly-launched projects, according to a report by Anarock, a property consultant.

The share of newly launched homes was much lower in the corresponding period of calendar year 2019 (CY19), with just 26 per cent homes sold in new projects out of about 78,520 units.

During Q1CY22, out of 99,550 units sold in the top 7 cities, 36 per cent were launched during the same quarter, the report said.

Among the top 7 cities, Hyderabad posted the highest sales share of new units. Of about 14,280 units sold there in Q1CY23, around 46 per cent were launched in the same period.

Meanwhile, the National Capital Region (NCR) saw the lowest absorption of newly launched homes. Out of 17,160 units sold in Q1CY23, just 30 per cent were launched during the quarter and the remaining units sold were in projects launched before Q1 CY23. In Q1CY19, of 13,740 units sold, the sales share of newly launched units was lower at 21 per cent.

However, NCR has seen remarkable change in the given period, the consultant said.

NCR was followed by Kolkata at 32 per cent share. In Kolkata, over 38 per cent of the 6,190 units sold in Q1CY23 were newly launched, while in the same period in CY19, 24 per cent of the approximately 4,020 units sold were newly launched.

“For the longest time, ready-to-move-in homes remained in highest favour with homebuyers because of the previously abysmal project completion track record in many areas of the country. This is now changing - under-construction homes in new launches are increasingly finding takers, though ready-to-move homes retain the top demand slot,” said Anuj Puri, chairman, Anarock group.

While explaining the reasons, Puri said that much of the new supply is by well-funded branded developers who will comply with real estate regulatory authority (RERA) regulations and complete their projects as per schedule.

In Q1 CY23, of 114,000 new units launched in the top 7 cities, the branded vs non-branded developer share ratio stood at 59:41 while back in 2015, it was the reverse at 41:59.

Secondly, investors are back on the housing market. Early-stage under-construction homes offer the kind of cost arbitrage that make residential real estate attractive to investors, who have largely given housing a miss over the last 3-4 years, Puri said.

Meanwhile, Mumbai Metropolitan Region (MMR) saw its sales share of new units jump to 40 per cent in Q1CY23, up from 24 per cent in the same period in CY19.

“In MMR, of 34,690 units sold in Q1CY23, approximately 40 per cent were fresh launches. In Q1CY19, of 24,010 units sold, 24 per cent were in new units,” the report said.

In Chennai, of 5,880 units sold in Q1CY23, newly-launched units accounted for a 41 per cent share - up from 29 per cent of 3,430 units sold in Q1CY19.

The report highlighted that Bengaluru and Pune also witnessed significant increases in the sales share of newly launched units. In Bengaluru, the share rose to 43 per cent in Q1CY23 from 28 per cent in the first quarter of CY19, while in Pune, it increased to 45 per cent from 35 per cent during the same period.