India's property market sales spike 68% - What's driving the market?

Real Estate Revival: The real estate market has kicked off 2024 with a notable upswing. Sales soared to Rs 1.11 lakh crore between January and March. This surge reflects a 68 per cent jump in value across the nation's eight leading residential markets, underscoring a burgeoning demand that has exceeded expectations, according to insights from PropTiger.com.

Notably, the increase isn't just in monetary terms; the total area of housing sold rocketed to 162 million sq ft, up by 63 per cent from the previous year's 99 million sq ft, painting a picture of a rapidly expanding market.

Prices propel upward

According to Proptiger.com, the volume of housing sales witnessed a notable climb, with 120,640 units finding owners in the first quarter alone — a 41 per cent increase YoY. This heightened activity in the housing sector is further accentuated by a substantial 15 to 20 per cent rise in property prices within key business districts, signalling a healthy and growing market. 

The Delhi-NCR region experienced a more than threefold increase in residential property sales, skyrocketing to Rs 12,120 crore from a previous Rs 3,476 crore.

DLF Ltd, one of India's largest listed real estate companies, became a major highlight for the quarter's narrative and grabbed attention with the swift sale of all 1,113 high-end luxury residential units in their latest project, DLF Privana South, amounting to Rs 7,200 crore within 72 hours before its official launch in January this year. 

Situated in Gurugram's Sector 76 and 77, DLF Privana South is part of the broader DLF Privana ecosystem, sprawling across approximately 116 acres.

Changing investment trends

Aakash Ohri, Joint Managing Director & Chief Business Officer, DLF Ltd., commented on the same stating, “Major cities across India have experienced sustained sales growth with NCR witnessing a surge in the residential market's demand. Over the last two years, the housing market in Gurugram has emerged as a lucrative real estate investment destination, with annual price appreciation reaching record highs".

"Today’s discerning buyers have been shifting their investment focus towards luxury homes, a move away from their previous preferences for different asset categories or luxury goods. One of the most significant trends this year has been an influx of demand for homes in the luxury and above segment. In India, while there has always been an appetite, people have preferred other asset classes to invest in, which has intensified significantly since the pandemic began,” Ohri added.

The high-end and luxury segments have shown strong sales growth within NCR’s real estate sector, particularly in Gurugram, which has experienced substantial growth, positioning the city as a top-tier destination for homebuyers seeking upscale living.

Micro market appreciation

Echoing these sentiments, Vivek Singhal, CEO, Smartworld Developers, highlighted, “The rising demand for luxury housing reflects a desire for lifestyles that echoes achievements and aspirations. Gurugram stands tall as a frontrunner with its residential sector driving the growth, mirroring the evolving preferences of homebuyers". 

"The realty market has witnessed price appreciation within the micro markets of Dwarka Expressway, Golf Course Extension and New Gurgaon.  This surge is driven by a blend of economic activity, improved connectivity, and infrastructural developments, propelling Gurugram on a swift trajectory of growth and urbanisation," Singhal added. 

The increasing demand for luxurious living spaces, outfitted with contemporary amenities and superior connectivity in these areas, plays an important role in the sustained capital appreciation.

Stable mortgage impact

Moreover, the overall sales momentum in India's top eight markets underscores a solid and sustained growth trajectory, propelled by stable mortgage rates and an increasing desire for homeownership. The Mumbai Metropolitan Region (MMR) notably saw a 31 per cent increase in housing sales, reaching Rs 34,340 crore.

Mohit Malhotra, Founder & CEO, NeoLiv, offered his perspective on Mumbai's market, stating, “Mumbai’s real estate market is leading India’s new wave of real estate demand and development opportunities. Being India's largest housing market, the market has the presence of credible developers with high quality products that adds to the city's ever-growing demand". 

"Increased need for professionally driven and well-funded developers will further establish Mumbai's real estate market as the most attractive in the country," he added.

Urban sector momentum

India's real estate market's vibrant start to 2024 signals not only a recovery but a thriving sector poised for continued growth, driven by a mix of luxury demand and strategic developments across the country's urban sphere.