Housing sales in October-December 2020 registered a considerable improvement with apartments in the sub-`75 lakh cost segment driving demand as record low interest prices coupled with some states slashing circle price and stamp duty attracted homebuyers. Developers also cashed in on the chance by introducing appealing provides which lowered the all round price of units.
As per PropTiger.com, developers sold 58,914 units in the final 3 months of 2020, which is a 27% year-on-year (y-o-y) decline, but was 68% greater sequentially. Except Ahmedabad, all the other top rated eight cities saw an raise in housing sales when compared to the preceding quarter.
A breakdown of sales in terms of costs showed that homes in the sub-Rs 75 lakh category accounted for 73% of the total sales. A additional break-up revealed that units in the Rs 45 lakh and under category created up 48% of the all round demand in October-December 2020.
“Developers launched attractive offers that effectively lowered overall cost for buyers, prompting more people to invest in property during the festive season in 2020. Low home loan interest rate together with lowering of circle rates by some states also contributed to the improvement in the sales,” PropTiger.com stated.
Maharashtra and Karnataka lowered stamp duties on house registration, which supplied a a lot-required added impetus to the residential sector in the aftermath of the pandemic. Consequently, Mumbai and Pune contributed more than 50% of the sales in the course of the final quarter of 2020 with a share of 31% and 20%, respectively.
“While the trends point to a market recovery and positive news given the imminent launch of a vaccine that will ease the pandemic concerns, our optimism should be cautious. Buyers continue to expect low home loan rates, extension of developer offers and prefer ready-to-move inventory than those under construction,” stated Mani Rangarajan, Group COO, of Housing.com, makaan.com, and PropTiger.com.
The sector is digitising at a speedy pace and more than 90% of possible property purchasers have moved on the web to shortlist properties, he stated adding, “We have seen a strong growth in online booking throughout 2020.”
The development in typical costs for newly launched projects across the top rated cities remained fairly flat, with costs becoming variety-bound. Prices improved in Ahmedabad and Hyderabad by more than 5% y-o-y, which could be attributed to improved demand from finish-customers for housing in particular areas. Average costs have been flat in Delhi NCR and the Mumbai metropolitan area (MMR), the two strongest housing markets in the nation.
Unsold housing inventory in top rated eight cities was at more than 7.18 lakh units as of December 2020 compared to almost 7.92 lakh units in December 2019, declining 9% on a y-o-y comparison.
However, due to the fact of a reduce sales velocity in 2020 as compared to 2019, the typical inventory overhang has improved to 47 months as of December 2020, as compared to 27 months in December 2019. Inventory overhang is defined as the time that builders would take to sell off their current stock at the existing sales velocity.