Housing sales, supply skid in India's top 7 cities in 2024: Report

Elections and slow project approval are among factors cited for decline in new housing supply

Housing sales in India's top seven cities declined 4 per cent in 2024 from the year before, according to real estate consultancy ANAROCK Research. Supply slipped 7 per cent.

 

The cities are the Mumbai metropolitan region (MMR), National Capital Region (NCR), Pune, Bengaluru, Chennai, Hyderabad and Kolkata. Approximately 459,650 houses were sold in 2024 and 476,530 last year. Kolkata had the highest decline in sales and Chennai was next. Sales in MMR and Bengaluru increased 1 per cent and 2 per cent.

 

Elections and slow project approval are among factors cited for new housing supply declining 7 per cent. As many as 4,12,520 new units were launched in the seven cities in 2024, against 4,45,770 units last year.

 

A three-year growth in sales and launches starting 2021 slowed down in 2024. "Apart from the dampening effect of general and assembly elections, project approvals slowed down markedly; this inevitably impacted new housing supply," said Anuj Puri, chairman of ANAROCK Group.

 

Despite supply declining, overall sales value increased by 16 per cent from last year. The value rise is attributed to average price appreciation and increasing unit sizes. Average house prices surged by 21 per cent annually. Units worth Rs 5.68 trillion were sold in 2024, against Rs 4.88 trillion last year.

 

Puri does not expect 2025 to match such price growth. “Average residential price hikes will stabilise in the coming year, though there will be steady growth amid increased input costs and high demand. 2025 will also see generous new supply infusions by listed developers, who have significant inventory lined up,” he said.

 

The stress in the affordable housing segment continued in 2024. Such homes – priced less than Rs 40 lakh – comprised 18 per cent of total supply in the first half of calendar year 2024 (H1 CY24), unchanged from last year. Affordable homes comprised 40 percent of total supply in 2019. Sales declined from 38 per cent in 2019 to be 18 per in 2024.

 

The supply of luxury homes – priced more than Rs 1.5 crore – increased by 24 per cent in 2024. The segment's share in total launches increased to 30 per cent in H1 CY24 from 11 per cent in 2019. Luxury home sales increased to 26 per cent in 2024, from merely 7 per cent in 2019.

 

Homes priced between Rs 40 lakh and Rs 1.5 crore (mid- and premium segment) had a share of 52 per cent in total supply in H1 CY24 and a share of 56 per cent in total sales in 2024. The segment's share in sales and launches has hovered around 49 to 63 per cent over the years.

 

Inventory in the seven cities declined by 8 per cent in 2024, on the back of curtailed new housing supply. More than 553,000 units are on sale in these markets, according to ANAROCK.