MUMBAI, Dec 30 (THe CONNECT) -Despite hardening property prices and home loan interest rate hikes in early 2023, it has been a superlative year for Indian residential real estate.

Latest ANAROCK Research data indicates that housing sales in the top 7 cities have created a new peak in 2023, breaching the previous high of 2022. Approx. 4,76,530 units were sold in 2023 against 3,64,870 units in 2022 across the top 7 cities – rising by 31% Y-o-Y. The last peak in the decade was seen in 2022, after 2014, when approx. 3.43 lakh units were sold in the top 7 cities.

MMR witnessed the highest sales of approx. 1,53,870 units in 2023, followed by Pune with approx. 86,680 units. The two western markets together led residential sales in 2023.

New launches across the top 7 cities saw a 25% annual rise – from approx. 3,57,640 units in 2022 to approx. 4,45,770 units in 2023. MMR and Pune saw the most new launches, together comprising an nearly 54% share of total new launches in the year.

Anuj Puri, Chairman – ANAROCK Group, says, “2023 has been phenomenal for the Indian housing sector, despite global headwinds, rising domestic property prices, and interest rate hikes over the first half this year. Housing sales in the top 7 cities breached the previous high of 2022, and new launches stayed in step with the current housing demand.”

“It was widely expected that rising property prices and interest rates, along with global market upheavals and uncertainties, would impact residential sales,” says Puri. “The market put paid to these predictions. Q4 2023 maintained the strong momentum set during the entire year with more than 1,27,370 units sold in the period. Interestingly, NCR was seen as deliberately restricting new supply in the year, to approx. 36,735 units, though it witnessed extremely healthy sales at approx. 65,625 units. With this cautious approach, NCR reduced its unsold inventory stock by a very significant 23% annually.”

Demand is likely to remain undeterred in 2024, even with average prices likely to appreciate by 8-10% across the top 7 cities. The unchanged home loan rates in the second half of 2023 helped maintain the overall positive consumer sentiment.

“While housing price hikes over the year did give rise to demand concerns, the unchanged home loan rates helped keep sales on an even keel,” says Puri. “Inflation in India has also more or less stabilized, and further hikes in the lending rate seem less than likely. The Indian economy remains bullish, and this directly correlates to residential demand. And, equally importantly, new supply is dominated by Grade A developers who are completing their projects on time. This is a strong housing demand bulwark.”

Among the budget categories, luxury housing demand increased exponentially as homebuyers continue to look for bigger livable spaces post the pandemic. The new luxury supply addition across the top 7 cities in 2023 has jumped up five times when compared to 2018. There is no reason to expect luxury housing demand to taper off in 2024.

Housing Sales Overview City-wise

City-wise Absorption (In Units)
City 2023 2022 % Change (2022 Vs 2023)
NCR 65,625 63,710 3%
MMR 1,53,870 1,09,730 40%
Bengaluru 63,980 49,480 29%
Pune 86,680 57,145 52%
Hyderabad 61,715 47,485 30%
Chennai 21,630 16,100 34%
Kolkata 23,030 21,220 9%
Total 4,76,530 3,64,870 31%

Source: ANAROCK Research

Residential sales stood at approx. 4,76,530 units in 2023 against 3,64,870 units in 2022 across the top 7 cities – rising yearly by 31%. MMR, Pune, Bengaluru, Hyderabad, and NCR, together accounted for 91% of the sales in the year.

  • MMR recorded the highest sales in 2023 across the top 7 cities. With nearly 1,53,870 units sold in 2023, the city witnessed an annual increase of a significant 40%.
  • Pune recorded sales of around 86,680 units in 2023 – an increase of 52% over 2022.
  • NCR recorded sales of approx. 65,625 units in 2023, increasing by 3% over the last one year.
  • Bengaluru saw approx. 63,980 units sold in 2023 – an annual increase of 29%.
  • Hyderabad recorded sales of approx. 61,715 units in 2023 – a yearly increase of 30% over 2022.
  • Kolkata recorded sales of approx. 23,030 units in 2023 – an annual increase of 9% over the previous year.
  • Chennai saw approx. 21,630 units sold in Chennai in 2023 – a yearly jump of 34% over 2022.

New Launches Overview – City-wise

City-wise New Supply (In Units)
 Cities Name 2023 2022 % Change (2022 Vs 2023)
NCR 36,735 25,360 45%
MMR 1,57,700 1,24,650 27%
Bangalore 54,435 49,195 11%
Pune 83,625 64,340 30%
Hyderabad 76,345 68,010 12%
Chennai 20,140 9,995 102%
Kolkata 16,790 16,090 4%
Total 4,45,770 3,57,640 25%

Source: ANAROCK Research

The top 7 cities saw approx. 4,45,770 new units launched in 2023, as opposed to 3,57,640 units in 2022 – an annual increase of 25%. The key cities contributing to new unit launches in the year were MMR, Hyderabad, Pune, and Bengaluru, together accounting for 83% of the total supply addition.

  • MMR saw the highest number (approx. 1,57,700) of new units launched in 2023 among the top 7 cities. Over 61% of the new supply was added in the INR 40 lakhs to INR 2.5 Cr budget segment.
  • Pune added approx. 83,625 units in 2023, a significant annual increase of 30% over the previous year. Over 80% of the new supply was added in the INR 40 lakhs – INR 2.5 Cr budget segment.
  • Hyderabad added new supply of approx. 76,345 units in 2023 – an increase of 12% over 2022. Over 82% of the new supply was added in the INR 40 lakh to INR 2.5 Cr budget segment.
  • Bengaluru added approx. 54,435 units in 2023, a yearly increase of 11%. Approx. 92% of the new supply was added in the INR 40 lakhs – INR 2.5 Cr budget segment.
  • NCR launched approx. 36,735 new units this year – a significant 45% rise over 2022. Over 51% of the new supply was added in the INR 40 lakh to INR 2.5 Cr budget segment.
  • Chennai added approx. 20,140 units in 2023, a whopping annual increase of 102% over the previous year. Over 82% of the new supply was added in the INR 40 lakh to INR 2.5 Cr budget segment.
  • Kolkata added approx. 16,790 units in 2023, an annual increase of just 4% over 2022. Approx. 78% new supply was added in sub-INR 80 lakhs budget segment.

Price Movement

City-wise Price Trends (In INR/sq./ft.))
 Cities Name 2023 2022 % Change (2022 Vs 2023)
NCR 5,800 5,025 15%
MMR 13,700 11,890 15%
Bangalore 6,550 5,570 18%
Pune 6,750 6,000 13%
Hyderabad 5,750 4,620 24%
Chennai 5,950 5,315 12%
Kolkata 5,150 4,700 10%
Total 7,080 6,150 15%

Source: ANAROCK Research

On annual basis, housing prices rose by between 10-24% across the top 7 cities, primarily due to increased input costs and strong demand. Hyderabad recorded the highest yearly jump of 24% in average residential prices – from INR 4,620 per sq. ft. in 2022 to nearly INR 5,750 per sq. ft. in 2023.

Available inventory as of 2023-end

On an annual basis, available inventory declined by 5% in 2023-end across the top 7 cities despite strong new housing supply during the current year. Approx. 6 lakh units are available for sale across the top 7 cities in India. Interestingly, NCR saw the highest decline of 23% in unsold stock on a yearly basis – from approx. 1,23,690 units by 2022-end to approx. 94,800 units as of 2023-end. This is the first time since 2013 that NCR’s unsold stock is less than a lakh units.