Indian Housing Market Sees 4% Decline in Sales Across 8 Major Cities Due to High Prices and Geopolitical Uncertainty
New Delhi: The Indian housing market saw a 4% decline in sales in the January-March quarter, with a total of 84,827 units sold across eight major cities. This drop is attributed to soaring property prices and market uncertainty stemming from the West Asia conflict, as reported by Knight Frank.
Housing sales in the January-March period last year stood at 88,361 units. The decline in sales of residential properties was observed in Mumbai, Delhi-NCR, and Pune, while the other five cities—Bengaluru, Hyderabad, Chennai, Ahmedabad, and Kolkata—saw an increase in sales.
Shishir Baijal, International Partner, Chairman & Managing Director of Knight Frank India, noted that the moderation in residential demand warrants closer attention, especially after a sustained period of growth. 'While this phase can be partly attributed to a natural consolidation after strong growth, the continued rise in prices alongside softening volumes indicates growing pressure on affordability and absorption,' he said.
Baijal also highlighted that the volatile geopolitical situation has led to subdued interest in residential demand. According to the data, housing sales in Mumbai fell by 7% to 23,185 units in January-March compared to the same period last year. In Delhi-NCR, sales dropped by 11% to 12,734 units in the first quarter of this year. Pune also saw a significant decline of 11% to 12,711 units.
On the positive side, Bengaluru recorded a 5% increase in sales to 13,092 units in January-March. Hyderabad saw a modest 1% growth to 9,541 units, while Chennai witnessed a 9% rise to 4,763 units. In Ahmedabad, sales grew by 2% to 4,758 units. Lastly, Kolkata saw a 5% increase to 4,043 units in the same period.
Knight Frank's data also revealed that the new supply of housing units fell by 2% annually to 94,855 units in January-March. This decline in supply, coupled with the rise in property prices, is likely to continue putting pressure on the housing market, particularly in terms of affordability.
Despite the challenges, experts believe that the Indian housing market remains resilient and has the potential to recover, provided that measures are taken to address affordability issues and stabilize the market. The government and real estate developers are expected to play a crucial role in this recovery by introducing policies and initiatives that can help boost demand and support sustainable growth in the sector.
