The residential realty sector is surging is booming in the first quarter of 2024 but only for luxury market as affordable housing continues to bleed, according to the latest data from Anarock Research. The share of premium houses (homes priced above Rs 1.5 crore) stood at 21 per cent in the first quarter this year across the top seven cities in overall launches. While the mid and high-segment homes (priced between Rs 50 lakh to 1.5 crore) comprised 59 per cent of the sales. This contrasts sharply with the trend of five years ago. In Q1 2019, affordable housing was at its peak, holding a share of 37 per cent out of approx. 78,525 units sold across the top 7 cities. Luxury housing had a mere 4 per cent share.
"Around 26,545 affordable housing units were sold in Q1 2024," Anuj Puri, Chairman of ANAROCK Group said. "The midrange and premium housing segment continued to rule the roost with approx. 76,555 units sold in the period. Affordable housing is nowhere near to recouping its stellar sales share in 2019," he further added.
National Capital Region (NCR) saw a major trend reversal in the last five years from the affordable segment having the biggest share in Q1 2019 to it slipping to the lowest in Q1 2024. Some 15,645 units were sold in NCR in the first quarter of 2024, the highest sales (around 6,060 units) were in the luxury segment contributing a 39 per cent share.
In Kolkata, around 5,650 units were sold out of which affordable housing contributed the maximum share (2,765 units) at 49 per cent.
Bengaluru, Mumbai Metropolitan Region (MMR), Chennai, Pune, and Hyderabad, on the other hand, saw their highest sales in the mid-range and premium housing segments (priced between Rs 40 lakh and Rs 1.5 Cr).
Commenting on why premium housing is gaining more traction, Puri said, “The luxury segment is driven by a mounting appetite for bigger homes by branded developers in superior locations." As luxury homes gain more traction in both new supply and sales, affordable housing continues its retreat to the sidelines.
The report notes that affordable housing is driven primarily by lower ticket sizes.
Out of the 1,10,860 units launched in Q1 only 19,980 units were in the affordable segment which was 18 per cent
The affordable segment amounted to a mere 18 per cent of total units launched in Q1 which was just 19,980 units out of 1,10,860 units. Five years ago, out of approx. 70,480 units launched across the top 7 cities in Q1, affordable housing comprised a whopping 44 per cent.
“The downward spiral of this erstwhile poster child of the Indian housing industry began during the pandemic, and then morphed into a broader malaise,” Puri added.
Puri believed that the revival of affordable housing depends on further government sops and incentives for buyers and developers.
