Festive season: Residential real estate sector witnesses robust demand

As Indians gear up to welcome the festive season with colour and lights, the residential real estate sector is witnessing robust demand from customers whose purchasing behaviour is often driven by auspicious timing and lucrative offers.

Real estate consultancy Colliers India stated that 2023 is likely to witness 20-30 per cent higher sales as compared to 2022. An Anarock Group report said that during the first half of 2019, 9 per cent of the buyers opted for luxury homes priced at over Rs 1.5 crore, while in the current edition of the first half of 2023, there has been a significant growth of 16 per cent. The rise in sales has been consistent post-pandemic. Reports suggest that during 2022-23, residential real estate property was up 30 per cent over pre-COVID-19 levels in India.

From the second quarter of 2022 onwards, the demand across key markets saw a surge owing to factors like improving personal finances, stability of the job market, and overall price appreciation, according to real estate company BCD Group.

“Positive momentum can be seen in 2023 as residential sales touched 120,280 units compared to sales of around 88,230 units in the third quarter of 2022. This exhibits an annual sales growth of around 36 per cent and a 5 per cent quarterly growth. The premium segment saw huge growth, dominating most of the launches in 2023, and it is expected to gain more steam over the affordable and mid-segment across the key eight markets – Mumbai, National Capital Region, Bengaluru, Pune, Chennai, Hyderabad, Kolkata, Ahmedabad,” said Angad Bedi, Managing Director at BCD Group.

Freebies are always a hit among Indian homebuyers during the festive season. “Developers provide Amazon vouchers that go up to Rs 1 lakh, rental free scheme for one year, iPad offer, among other offers, that continue to propel customer excitement for buying in this market,” said Bedi.

He added that customers have a mindset to go for a change during the festive season, and developers see it as an opportunity to combine it with long-term, practical offers that drive buyers to close a deal during the period.

BCD Group is said to offer guaranteed rental options for homebuyers at 7 per cent for two years. Mangalam Group introduced a loyalty customer incentive wherein with a minimum purchase of Rs 25 lakh or more, customers are gifted with a gold coin. Prestige Group has introduced a 25:75 flexible payment plan for some of its properties where the homebuyer needs to pay only 25 per cent of the amount in advance and the rest of the amount during move-in.

Real estate consultancy Anarock Group said that the first nine months of 2023 witnessed total housing sales of over 3.49 lakh units across the top seven cities despite a rise in both interest rates and housing prices, and stays confident during the festive season as well.

In many cases, real estate developers line up their projects to launch them during the festive season. As per Anarock, last year in the festive quarter of October to December, there were as many as 93,000 units launched across the top seven cities. And this year, the company expects 10-15 per cent yearly growth which means that new supply will be above 1 lakh units.

“Going by the current trends in the housing market, this year we may expect at least 25-30 per cent yearly growth in housing sales in the fourth quarter of 2023 as against the corresponding period in 2022. Last year, the top seven cities saw total sales of nearly 92,180 units in the festive quarter of the fourth quarter of 2022,” said Anuj Puri, Chairman at Anarock Group.

The festive season provides the one last thrust to residential real estate activity in India, according to Colliers India. Nonetheless, it believes home buying remains an emotive concept and the perks of homeownership can no more be overemphasized, especially post-pandemic.

“Typically, the fourth quarter, marked by a higher inclination of homebuyers to wrap-up property purchases in the festive period and instantaneous liquidity benefit aided by developers, has provided the final push to residential activity. Industry consensus is indicative of 2023 housing sales already reaching close to 2022 levels and given the ongoing festive season, 2023 is likely to witness 20-30 per cent higher sales as compared to 2022,” said Badal Yagnik, Chief Executive Officer at Colliers India.