Premium Housing Demand Fuels Record Sales in Top 8 Indian Cities
India's residential real estate market continues to thrive, with sales in the top 8 cities reaching an 11-year high in the first half of 2024, driven by strong demand for premium homes.
Housing SalesPremium HomesReal Estate MarketIndiaKnight FrankReal Estate NewsJul 04, 2024
Much of this demand is driven by sales in the premium segment, comprising homes priced above ₹1 crore. The National Capital Region (NCR) led the way with 20,795 units sold, followed by Mumbai and Bengaluru with 14,699 and 13,698 units sold, respectively.
The premium segment has seen a significant uptrend, accounting for 41% of total sales in the first half of the year, up from 30% a year ago. In contrast, the affordable segment (homes priced ₹50 lakh and below) has shrunk to 27% from 32%.
Developers are responding to the strong housing demand by ramping up supplies. The 183,401 units launched in the first half of the year are at a 10-year high in terms of units launched in a half-yearly period.
Gulam Zia, Senior Executive Director - Research Advisory, Infrastructure and Valuation at Knight Frank India, notes that the premiumization of the market is observed in both demand and supply. 'While we appreciate the rise in the premium sector, the corresponding decline in the lower price categories should be addressed to ensure inclusive growth of the market.'
All eight cities saw home prices rising on a 12-month basis, with Ahmedabad seeing the least increase at 1% and Bengaluru the highest at 9%.
The office market also had a stellar first half, with transactions reaching 34.7 million square feet between January-June, up 33% from a year ago. Bengaluru led the Indian office market with 8.4 million square feet of transactions, recording a 21% year-on-year growth.
Global Capability Centres (GCC) saw a 48% increase in transaction volumes to 9.8 million square feet from 6.6 million square feet a year ago.
With India's economic growth expected to remain strong, both the housing and office markets are expected to continue to report strong traction.
'India has consistently maintained its status as one of the fastest-growing large economies, which has positively impacted office demand. Given the strong economic momentum and the improving global growth outlook, coupled with the trend of higher absorption in the second half of the year, we can confidently anticipate that the Indian office market will conclude 2024 on a record high,' said Viral Desai, Senior Executive Director, Occupier Strategy and Solutions, Industrial and Logistics, Capital Markets and Retail Agency, Knight Frank India.
Frequently Asked Questions
Which city saw the highest demand for premium homes?
NCR saw the highest demand for premium homes, with 20,795 units sold.
What is the current trend in the Indian residential real estate market?
The Indian residential real estate market is witnessing a surge in demand, driven by premium homes priced above ₹1 crore.
How has the office market performed in the first half of 2024?
The office market had a stellar first half, with transactions reaching 34.7 million square feet between January-June, up 33% from a year ago.
What is the outlook for the Indian office market in 2024?
The Indian office market is expected to conclude 2024 on a record high, driven by strong economic momentum and improving global growth outlook.
Who is the leading real estate consultancy firm quoted in the article?
Knight Frank is the leading real estate consultancy firm quoted in the article.
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