Monday, January 9, 2023

India’s Residential Demand increased 19%, Supply Grew 2.7% In 2022 Reveals Magicbricks PropIndex Report (Oct-Nov), 2022


*Residential demand increased YoY across cities including Mumbai (52.1%), Noida (35.8%), Gurugram (34.5%) and Bengaluru (33%) 

*Pan-India average rate increased 13.9% YoY  

*Residential supply increased YoY across cities including Mumbai (13.4%), Bengaluru (8.4%), Chennai (2.9%) and Delhi (2.1%) 

The Indian residential market demonstrated resilience and overall growth in 2022, observed Magicbricks’ PropIndex Report for October-December, 2022. According to the report, the aggregate residential demand (searches) increased 19% YoY led by major cities such as Mumbai (52.1%), Noida (35.8%), Gurugram (34.5%), Delhi (14.8%) and Bengaluru (33%).  

The report further observed that the average rate increased 13.9% YoY and the cumulative supply (listings) grew 2.7% YoY. Noida (13.7%), Greater Noida (12.3%), Hyderabad (11. 7%) and Thane (8.1%) witnessed the highest increase in average rate YoY; and Mumbai (13.4%), Bengaluru (8.4%) and Thane (4.1%) saw the highest YoY increase in residential supply. The report also observed that 2 and 3 BHK units were the most preferred across these 12 cities. While cities like Kolkata, Chennai, Hyderabad continue to see a surge in demand for affordable units, other big metro cities like Bengaluru, New Delhi and Mumbai are attracting demand for mid-segment residences. 

Elaborating on the trends, Sudhir Pai, CEO, Magicbricks commented, “In 2022, residential demand, supply and prices recovered, and the year bode well for both under-construction and ready-to-move-in houses. Despite consecutive hikes in the Repo Rate and home loan rates in the past quarters, end-users remained keen on home buying, encouraging developers to accelerate new project launches while delivering their existing projects. Overall, we are optimistic that the residential demand will be largely sustained in 2023 as well.” 

The report further observed that the pan-India average rates of ready-to-move-in properties increased 9.0% YoY, and average prices of under-construction properties increased 15.3% YoY.  

City-wise Highlights 

Ahmedabad 

Ahmedabad recorded a dip of 11.3% in demand (searches) 

Decline by 1.2% in supply (listings) QoQ 

Average property rates spiked by 1.7% QoQ. 

Launch of Ahmedabad Metro Phase 1, which includes the East-West and North-South corridors, the demand, and supply for properties are expected to improve in their catchment areas. 

SG Highway and Bopal continue to have the highest demand 

3 BHK units priced between INR 4,000-6,000 psf are preferred by the majority of homebuyers in 

Ahmedabad 

Bengaluru 

Bengaluru’s residential market observed an increase of 1.5% QoQ in demand (searches) 

New project launches in the peripheral areas led to 1.1% QoQ increase in supply (active listings) 

The average property rate for the city witnessed a growth of 2.2% QoQ 

Post-pandemic, Bengaluru witnessed a large section of the non-local workforce resuming work from office 

This factor has largely contributed to a sizable 33% surge in demand YoY. However, supply grew 

by 8.4% YoY, thereby exhausting the existing inventory. 

Consequently, the rates of both RM and UC properties have surged 

Over the past few quarters, East Bengaluru has sustained its position as the most preferred 

location for home buyers 

2 and 3 BHK units priced between INR 5,000-7,500 psf largely dominate the residential real 

estate market in Bengaluru 

Chennai 

In Q4 of 2022, Chennai’s residential market witnessed a QoQ dip of 4.8% in demand (searches), 

the supply (active listing) grew by 1.6% 

Further, average property rates witnessed an increase of 1.6% QoQ 

2 BHK units priced between INR 5,000-10,000 psf dominate the residential real estate market in 

Chennai 

The revised property tax in Chennai deterred the growth of residential demand in the city over the last 2 quarters 

However, ongoing commercial and industrial development and proposed metro connectivity 

along with a greenfield airport are likely to drive demand for Chennai’s real estate market in the 

coming year 

OMR remains top micro-market in Chennai 

New Delhi 

In Q4 2022, Delhi observed a decline of 18.1% QoQ in residential demand (searches) 

The city’s supply (listings) saw a revival and rose by 2.6% QoQ 

The average property rate in the city also recorded a QoQ surge of 3.3%, due to rise in input costs 

Due to the existing inflationary pressures, the average rate for UC properties saw a significant 

upward movement of 8% QoQ, while RM properties also appreciated by 2.9% during this time 

DLF, Unity Group, and Godrej Properties were the top developers on the basis of active listings 

during the quarter 

3 BHKs and houses priced under INR 10,000 psf were the most searched units in Delhi 

Dwarka and Janakpuri continued to be the most favoured residential destination 

Gurugram 

After gaining major traction over the past three quarters, the residential market of Gurugram 

witnessed a marginal decline of 2.3% QoQ in demand (searches) 

The residential supply (listings) remained stable showing a QoQ decline of only 0.5%. 

However, the average property rate in the city observed a third consecutive quarterly hike, 

increasing by 4.8% in October-December after a 1.5% growth in the previous quarter. 

During October-December, the average rates of both RM and UC properties appreciated by  

4.5% and 6.0% QoQ, respectively. 

New Gurugram and Sohna Road continue to be the most preferred localities for homebuyers 

Gurugram registered highest demand and supply concentration for 3 BHKs & > 3 BHKs, while the mid-segment of INR 5,000-10,000 remained the most searched criteria 

Hyderabad 

In Q4 2022, Hyderabad’s residential market witnessed a QoQ dip of 2.2% in demand (searches) 

The supply (active listing) grew by 4.9% 

The city’s average property rate surged by 4.2% QoQ 

The entry of many small developers in Hyderabad’s residential market has inflated the inventory 

resulting in large volumes of unsold stock 

Western Hyderabad remains the most preferred real estate hotspot 

Affordability reigns supreme as < INR 5,000 psf is the most search criteria for homebuyers 

Kolkata 

During this quarter, residential demand (searches) in Kolkata declined by 13.7% QoQ but registered a YoY increase of 4.4% 

The supply (listings) witnessed a decline of 0.6% QoQ, but remained stable YoY 

Average property rates witnessed a growth of 2.1% QoQ and 7.6% YoY owing to an increase in 

input costs 

Kolkata has contributed a share of around 6% in demand and 9% in supply in the major Indian 

residential real estate markets over the past year 

Affordable properties dominate Kolkata’s residential market 

Demand and supply are spatially well distributed all over Kolkata 

Mumbai 

In Q4 2022, Mumbai’s residential market witnessed a growth of 7.6% QoQ in demand (searches) 

The supply (listings) increased by 7.2% QoQ and average property rate increased 1.3% QoQ 

The quarter was characterized by an increase in new launches and the completion of many under- 

construction projects across the city 

These factors have invigorated the market and scaled up demand 

With the operations of metro lines 2A and 7 to commence by January 2023, demand and supply 

are expected to increase even further 

Key western suburb markets witnessed maximum traction in Q4 2022 

2 BHKs priced between INR 15,000-25,000 psf preferred by homebuyers in Mumbai 

Navi Mumbai 

Rresidential demand (searches) and supply (listings) in Navi Mumbai declined by 7.9% 

and 0.8% QoQ, respectively 

The city’s average property rate remained stable since it recorded an increase of only 0.1% 

Navi Mumbai’s residential real estate market is expected to grow with further development of 

its road, rail, and airport infrastructure 

Homebuyers are anticipating new launches by reputed developers active in the region 

Except for a few high-end localities such as Palm Beach Road, Navi Mumbai’s real estate market 

is primarily driven by affordable property options 

Panvel, Kharghar and Airoli remain the most preferred residential destination 

2 BHK units continue dominance in Navi Mumbai followed by 1 BHKs 

Noida & Greater Noida 

With improvement in new launch activity, residential supply (listings) in Noida-Greater Noida 

observed growth of 6.7% QoQ in Q4 2022 

Residential demand (searches) witnessed a QoQ decline of 2.5%, which indicates restrained 

buyer sentiments 

Steady exhaustion of unsold inventory of completed or near-completion homes has pushed 

home buyers to look for under-construction properties 

The average property rate witnessed a QoQ uptick of 3.9% in Q4 2022 compared to a 1.9% rise 

in Q3 2022 

Demand and supply were highest in Noida Extension and Sectors 74-79 

Nearly 56% of consumer searches were directed towards properties priced <INR 5,000 psf, 

indicating that the market is driven by affordability 

Pune 

The long festive season at the end of the year bode well for Pune’s residential market 

Demand and supply for residential properties grew by 3.2% QoQ and 4.2% QoQ, respectively 

At the same time, the city’s average rate increased by 1.5% QoQ 

Moreover, proposals of several town planning schemes and infrastructural projects such as the 

Intermediate Ring Road, High-Capacity Mass Transit Route (HCMTR) and Pune Metropolitan 

Region (PMR) Ring Road are driving the rates up 

Airport Road, Baner and Wakad continue their dominance in Q4 2022 

Homebuyers prefer affordable properties with compact units 

Thane 

Demand (searches) for residential properties in the city registered a growth of 2.8% 

QoQ, the supply surged by 11.1% QoQ. The average rate for the city increased by 0.8% QoQ 

Key infrastructure developments to boost transportation and connectivity such as the Central 

Railway Corridor between Thane and Diva, the proposed Mumbai-Ahmedabad High Speed 

Railway, Personal Rapid Transport System (PRTS) continue to augment demand and supply 

Ghodbunder Road and Western Thane remain the most preferred micro-market 

2 BHKs and units costing <INR 9,000 psf gained traction in Q4 2022 

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