If you’re considering purchasing a home soon, recent data from PropTiger.com’s ‘Real Insight Residential Report’ may impact your decision. The report reveals a significant 25% drop in new housing launches and a 5% decline in sales during the July-September quarter of 2024 across India’s top eight real estate markets. Here’s what the data says and what it could mean for homebuyers.

Major Housing Markets Analyzed

This report examines the real estate landscape across India’s key housing markets:

•   Ahmedabad
•   Bengaluru
•   Chennai
•   Hyderabad
•   Kolkata
•   Delhi-NCR (covering Gurugram, Noida, Greater Noida, Ghaziabad, and Faridabad)
•   MMR (Mumbai, Navi Mumbai, and Thane)
•   Pune

A Decline in Sales and New Launches

According to PropTiger.com, the housing sector saw a marked slowdown. Sales dropped by 5% year-on-year with only 96,544 homes sold in Q3 2024, compared to 101,221 homes sold in the same period in 2023. Similarly, new housing launches fell by a significant 25%, with 91,863 units introduced in the market in Q3 2024 versus 123,080 in Q3 2023.

Why Is the Market Slowing Down?

Vikas Wadhawan, CFO of REA India and Business Head of PropTiger.com, attributes the decline to a variety of factors. Rising prices have slowed both demand and supply. Additionally, the general elections in April-June caused a temporary lull in market activity, and a slowdown in approval processes during July-August also impacted launches and sales. Despite these challenges, consumer sentiment remains strong due to solid market fundamentals, reinforcing real estate as a favored investment option.

Market Dynamics: Adjusting to New Price Realities

Wadhawan pointed out that over the past few quarters, prices have risen by 3% to 50% in certain prime localities. While this price surge has caused some buyers to delay their purchases, the market is gradually adjusting to these new price points. The festive season, starting with Navratri, is expected to bring renewed buyer interest and likely an increase in sales activity.

Regional Market Trends: Winners and Losers

Sales in Q3 2024:

•   Delhi-NCR: Sales surged by 29%, with 10,098 units sold, up from 7,800 units last year.
•   Mumbai: A slight decline of 1% was recorded, with 30,010 units sold, compared to 30,299 units in Q3 2023.
•   Hyderabad: Sales dropped by 19%, with 11,564 units sold compared to 14,191 last year.
•   Bengaluru: Sales were down by 11%, with 11,160 units sold, down from 12,588 in Q3 2023.
•   Ahmedabad: A 9% drop in sales was noted, with 9,352 units sold compared to 10,305 units last year.

New Launches in Q3 2024:

•   Delhi-NCR: New housing launches jumped by 76%, with 11,955 units launched compared to 6,810 units last year.
•   Mumbai: New residential units dropped by 13%, with 31,123 units launched versus 35,923 in Q3 2023.
•   Hyderabad: Witnessed a sharp 58% drop, with new launches falling to 8,546 units from 20,481 in Q3 2023.
•   Pune: New supply decreased by 36%, with 13,543 units introduced compared to 21,287 last year.
•   Kolkata: Though there was a quarterly rise, Kolkata saw a 61% year-on-year decline in new launches, with only 1,516 units compared to 3,850 last year.

What Does the Future Hold for Homebuyers?

With the festive season approaching, developers are expected to introduce new offers and incentives to attract buyers. Wadhawan anticipates that this could revitalize market activity despite the challenges of rising prices and slowed launches. Buyers should keep an eye out for festive discounts and attractive offers that could help mitigate the recent price hikes and make their home-buying experience more rewarding.

If you’re looking to invest in real estate, this could be the right time to explore the market and take advantage of potential festive season deals. However, the decline in launches and sales indicates a more cautious environment, where buyers and developers are adjusting to new realities.