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In the third quarter of 2024, house prices surged by 20 per cent across the top 8 Indian cities, resulting in a 5 per cent decrease in sales and a 25 per cent drop in new home launches, as per the latest report.
Indian cities real estate sector (Pic: Depositphotos)
Mumbai: A recent report has revealed significant shifts in the Indian housing market, particularly in the top 8 Indian cities. House prices have soared by 20 per cent, contributing to a 5 per cent drop in sales and a 25 per cent decline in new home launches in the third quarter of 2024. This trend highlights the growing challenge of homeownership for residents of major cities such as Delhi NCR, Mumbai, Bengaluru, and Hyderabad.
According to the ‘Real Insight Residential Report’ by PropTiger.com, the total number of house sales fell by 5 per cent from 1,01,221 units in Q3 2023 to 96,544 in Q3 2024. Similarly, new home launches across the top 8 Indian cities saw a sharp 25 per cent decline, dropping from 1,23,080 units in 2023 to 91,683 units in 2024.
Regional Variations in House Sales and New Launches
Interestingly, Delhi NCR bucked the overall trend. House sales in this region surged by 29 per cent, increasing from 7,800 units to 10,098 units in the July-September 2024 period. New home launches also saw a remarkable 76 per cent growth, with approximately 5,000 new homes introduced in this quarter.
However, the same cannot be said for Mumbai, where house sales dipped by 1 per cent. The city recorded 30,010 sales in Q3 2024 compared to 30,299 in Q3 2023. Additionally, new home launches in Mumbai experienced a 13 per cent decline, with 32,123 units introduced in 2024 compared to 35,923 units last year.
In Bengaluru, the housing market mirrored the national trend. House sales fell by 11 per cent, with only 11,160 units sold in Q3 2024, down from 12,588 units in the same quarter of 2023. Similarly, Ahmedabad experienced a 9 per cent decrease in sales, with just 9,352 units sold in Q3 2024, compared to 10,305 units in the previous year.
Dramatic Declines in New Home Launches
Some cities have seen an even steeper decline in new home launches. Hyderabad, for instance, recorded a significant 58 per cent drop in new launches, from 20,481 units in Q3 2023 to just 8,546 units in Q3 2024. Pune experienced a 36 per cent year-on-year (YoY) decrease, launching only 13,543 new homes compared to 21,287 units in 2023.
Meanwhile, Kolkata faced a staggering 61 per cent reduction in new home launches, introducing fewer than half the number of units compared to the previous year’s figures.
Implications of Rising House Prices
The rise in house prices across the top 8 Indian cities has made homeownership increasingly difficult for many residents. As fewer affordable homes become available, fewer people are purchasing property. This has led to both a decline in house sales and a reduction in new home launches, as developers respond to the waning demand.
As more individuals continue to migrate to these major cities from other parts of India, the cost of owning a house is likely to increase further, exacerbating the affordability crisis. The limited supply of homes in these overcrowded cities is pushing prices up, making it harder for many to fulfil their dream of homeownership.
The Real Insight Report underscores the growing challenges faced by aspiring homeowners and suggests that the Indian housing market will need to find innovative solutions to meet the rising demand amidst these escalating costs.
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