Housing Sales in 7 Cities Rise 31% to 4.76 Lakh Units

Chennai: Housing sales in the top 7 cities have created a new peak in 2023, increasing 31 per cent over the previous year. Meanwhile, the Affordability index, the equated monthly instalment (EMI) to income ratio for households also improved in 2023, according to separate reports by two real estate consultancies.
The affordability index of Hyderabadremained unchanged at 30 per cent for both the years of 2023 and 2022, making it the second most expensive residential market.

Ahmedabad remains the most affordable housing market in the country with an affordability ratio of 21 per cent, while Kolkata’s ratio is 24 per cent. Mumbai is the only city beyond the affordability threshold of 50 per cent, though there is an improvement of 2 per cent. The National Capital Region, Bangalore and Chennai saw the affordability index improving, said Knight Frank in a report.

Around 4.76 lakh housing units were sold in 2023 in the top 7 cities, against 3.64 lakh units in 2022, a 31 per cent increase. Last peak in the decade was seen in 2022, after 2014, when around 3.43 lakh units were sold in the top 7 cities.

Hardening property prices and home loan interest rate hikes in early 2023 did not deter sales, said Anarock Group. Mumbai witnessed highest sales of 1.53 lakh units, followed by Pune with 86,680 units.

In terms of supply, around 4.45 lakh new units were launched in 2023 against 3.57 lakh units in 2022, a growth of 25 per cent.

Available inventory decr-eased by 5 per cent in 2023 over 2022 despite generous new supply during the year.

Residential prices collectively rose 15 per cent annually in the top 7 cities and Hyderabad saw the highest 24 per cent annual rise amidst 30 per cent rise in sales and 12 per cent growth in supply.

In 2024, average prices are likely to increase by 8-10 per cent across the top seven cities.

Expected moderation in inflation and projected downward trend in interest rates should further improve home affordability in 2024 in the country, according to the Knight Frank India.