Residential real estate sales rose 8% in the April-June quarter, compared to a 3% decline in January-March, suggesting that the market which has seen sluggish growth over the last 2-3 years, is finally seeing some revival signs.
Sales across nine key Indian cities - Mumbai, Pune, Noida, Gurgaon, Bengaluru, Chennai, Hyderabad, Kolkata and Ahmedabad – rose to 55,550 units in first quarter of this fiscal from 51,500 units in fourth quarter of 2015-16, according to a report by real estate portal PropTiger.
The revival in sales was primarily driven by an uptick in demand in Bengaluru, Pune and Mumbai, which together accounted for 61% of total sales across the 9 cities in the first quarter of fiscal 2017, the report added.
“Residential real estate in India is at its inflexion point, with improved activity driven by softening interest rates, stagnant prices and controlled supply,” said Anuraj Jhanwar, business head, PropTiger.
Project launches also picked up 14% at 41,000 units in April-June versus 36,000 in Jan-March.
“The first quarter of FY17 has started on a positive note for residential markets. Fence-sitting end users are beginning to enter the market. With 14% growth in new launches across top cities during the quarter, the worst seems to be behind us,” said Dhruv Agarwala, CEO, PropTiger.
Another real estate consultancy firm, Knight Frank too had recently pointed out that residential sales across top 8 cities, in the first six months of calendar 2016 rose 7% to 135,015 units from 126,615 units in the first half of 2015. In the first half of this year, sales in Mumbai rose 23%, while those in Bengaluru were up 18%, it had said.
Analysts expect that a fall in interest rates, stable inflation and the seventh pay commission payouts will boost demand over the next few quarters.