New Delhi: Data from PropTiger.com reveals a significant rise in the proportion of high-end housing units priced at Rs 1 crore and above across major Indian housing markets for the April-June period. The quarterly report 'Real Insight: Residential April-June 2024' by REA India-owned PropTiger.com indicates that 43% of new residential launches in India's top eight markets during these three months were priced above Rs 1 crore. Furthermore, homes in this price range comprised 38% of total sales for the quarter.
The report covers housing markets in Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Delhi-NCR (including Gurugram, Noida, Greater Noida, Ghaziabad and Faridabad), MMR (Mumbai, Navi Mumbai and Thane) and Pune. Data shows that a total of 101,677 units were launched in the quarter ending June 30, marking a slight decrease of 1% from the 103,020 units launched in the previous quarter. In contrast, 113,768 units were sold in Q2 2024 compared to 120,642 units in the March quarter.
Affordable Housing Declined
Only 15% of new housing units fall into the up to Rs 45 lakhs price bracket, which is considered affordable housing according to government standards. In contrast, 25% of quarterly sales were in this price range, indicating a higher proportion of sales compared to new supply, according to the report.
CFO of REA India and Business Head of PropTiger.com Vikas Wadhawan explained that the share of affordable housing in both sales and launches has declined recently, mainly due to increasing demand for larger homes with more amenities.
In major cities, rising construction and land costs are making it difficult for developers to offer homes within the Rs 45 lakh budget typically associated with the affordable category. Consequently, there are fewer launches in this segment. Additionally, the impact of rising property prices on demand cannot be ignored. While the growing demand for high-end homes reflects rising income levels in one of the world's fastest-growing economies, the decreasing share of affordable housing is a concern for the most populous country in the world."
Vikas Wadhawan believes that the situation might improve due to several key measures announced in the Union Budget 2024 by Finance Minister Nirmala Sitharaman on July 23. Initiatives like the launch of PMAY 2.0, the new interest subsidy scheme, the potential rationalisation of stamp duties by states and increased disposable income from recent tax changes could boost demand for affordable housing. The government might also consider adjusting the affordability criteria for larger cities.
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