Housing sales across the top eight cities rose 51 per cent last year, even as the office market continued to slump due to the COVID-19 pandemic with gross leasing witnessing a 3 per cent fall, said Knight Frank India in its half-yearly report 'India Real Estate: 2021' here on Wednesday.
The Residential Sector had an unprecedented year of growth with sales rising by 51% year on year (YoY) to be recorded at 232,903 units across the top eight cities of the country. New home launches also saw a significant rise of 58% YoY with the addition of 232,382 units in 2021. For the Commercial office segment, the year was a mixed bag. Leasing volumes, recorded at 38.1 million square feet (MSF) though remaining at similar levels as 2020, clearly indicated the potential the market has in terms of leasing.
‘’Noteworthy is that an overwhelming 68% of the total leasing in 2021 took place in the second half of the year. Bengaluru led the pack with 12 MSF of total leasing during the year. New completions in 2021 for office space was recorded at 39 mn sq ft, higher by 9% over the preceding year," said the report.
"In an extraordinary year marred by the pandemic and lockdowns, the real estate sector showed great resilience in 2021." Housing sales in the second half of the last calendar year witnessed the highest volume since the first half of 2016.
Knight Frank India CMD Shishir Baijal said, “Despite the disruptions caused by the pandemic, residential sales momentum increased across the key eight markets of the country due to a plethora of demand stimulants such as lowest home loan rates, government sops and change in attitude. Sentiments remain strong and should continue to aid market volumes in the near term. While buyer preferences were skewed towards ready inventory, established developers with a robust execution record are increasingly finding a market for their under-construction inventory.”
According to the report, 133,487 housing units were sold in the second half of the year 2021 cumulatively for the top eight cities. This also showcased a substantial 41% increase Year-on-Year (YoY). Around 69,477 housing sales were reported in Q4 2021. Residential prices stayed steady or recorded marginal growth in seven of eight cities during the year. Homes priced over Rs 50 lakhs constituted around 58% of the overall sales in H2 2021.
In terms of 12-month residential price change, Chennai, Hyderabad and Bengaluru registered an increment of 7 per cent, 5 per cent and 4 per cent, respectively. Mumbai witnessed a marginal increment of 1 per cent. The prices were recorded to be stable in Pune, Kolkata and Ahmedabad. The Delhi-NCR saw a marginal decline of 1 per cent.
Further, housing sales in Mumbai rose 29 per cent to 62,989 units in 2021, from 48,688 units in the previous year. Office leasing fell 37 per cent to 3.8 million square feet. In Delhi-NCR, housing sales increased 65 per cent to 35,073 units from 21,234 units. Office leasing rose 38 per cent to 6.4 million square feet.
Housing sales in Bengaluru were up 61 per cent to 38,030 units, from 23,579 units. Office leasing was marginally down to 12.2 million square feet. In Pune, housing sales rose 38 per cent to 37,218 units, from 26,919 units, while office leasing grew slightly to 3.8 million square feet.
In Chennai, housing sales went up 38 per cent to 11,958 units and office leasing fell 14 per cent to 3.9 million square feet. While, in Hyderabad, housing sales jumped over two times to 24,318 units and office leasing remained flat at 6 million square feet.
Housing sales in Kolkata grew 62 per cent to 14,405 units and office leasing dropped marginally to 0.8 million square feet.
Ahmedabad reported a 37 per cent rise in housing sales in 2021 at 8,911 units as against 6,506 units in the previous year. Office leasing fell 12 per cent to 1.1 million square feet.
