More Indians are purchasing newly-launched homes post-COVID

More Indians are purchasing newly-launched homes post-COVID

The ever-increasing dominance of branded developers in India’s residential real estate market is shifting homebuyers’ attention from ready-to-move or almost-complete projects to newly launched projects. While in the decade leading up to 2020, Indians were preferring ready-to-move homes due to repeated incidences of project delays and realtors going bankrupt, in the current decade more number of buyers are booking homes at the launch of the respective projects.

Latest data from Anarock Research shows that over 40% of approximately 4.77 lakh homes sold in 2023 was from newly launched projects. The share of sales from newly launched supply in the pre-pandemic year of 2019 was much lower at 26%, when some 2.61 lakh homes were sold.

The steady rise in the share of newly launched homes out of the yearly sales is evident from the data. Growing from 26% in 2019, the share of newly launched homes in total home sales of the respective year rose to 28% in 2020, when some 1.38 lakh units were sold overall. In 2021, the share grew to 34% out of the total 2.37 lakh home units sold in the top metropolis. In 2022, the share of newly-launched homes in the total 3.65 lakh units sold further surged to 36%.

Among the top 7 cities, Delhi-NCR reported the lowest absorption of newly launched homes. Of the 65,625 units sold in 2023, about 27% were launched during the year. The remaining units that were sold, were from projects launched in earlier years. Gurugram outperformed other markets in the NCR region. Of the 36,970 units sold in millennium city in 2023, at least 35% were newly launched.

While Chennai, Bengaluru and Hyderabad led the pack with over half of the homes sold during 2023 were launched during the years. In Chennai, 58% of the total homes sold in 2023 were launched during the years, followed by Bengaluru (51%) and Hyderabad (50%).

“The fact that 40% of newly launched housing stock has already been sold across the top cities strongly underscores increasing homebuyer confidence on new projects. Ready homes became the biggest draw amid project delays in the past, but the trend is now changing. This is attributable to the increasing market share of financially strong branded developers with sound completion track records in the last 2-3 years,” says Anuj Puri, Chairman, Anarock Group.

According to him, developers’ focus on good locations and appropriate unit sizes and configurations is playing a role in the latest surge in demand for newly launched homes. “Several leading developers are snapping up land parcels across key cities to develop residential projects that are aligned with what customers want. The data indicates that there were at least 97 separate land deals for over 2,707 acres closed in 2023 across the country, with at least 72% of the sold land earmarked for residential development,” he says.

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