Gurgugram dominates as NCR sees 30,114 housing unit sales in H1 2023; sub-Rs 50 lakh category hit the hardest

While the share of the sale of homes priced above Rs 1 crore has surged, the volume of home sales in the range of Rs 50 lakh to Rs 1 crore continues to reduce as homebuyers considering purchases for these products are more price sensitive to escalating borrowing costs in the wake of previous repo rate revisions. The share of this category in sales has declined from 33 percent in H1 2022 to 22 percent in H1 2023. For homes priced less than Rs 50 lakh, the percentage share has shrunk from 25 percent to 13 percent in the same period.

The sub-Rs 50 lakh category has been the hardest hit by the repo rate revisions as the buyer profile for such products usually look at affordable options for home ownership and any changes in borrowing costs and EMIs hamper their decision-making much sooner.

New launches moderate

In contrast to housing sales, new launches moderated from 34,507 units in H2 2022 to 29,738 units in H1 2023. However, on a year-on-year (YoY) basis, H1 2023 launch volume surpassed that of H1 2022 by 4 percent.

Though developers continued to launch new projects to meet the latent homebuying demand, many have simultaneously intensified efforts for new land acquisition in preparation for a future pipeline of projects. NCR’s key peripheral belts are witnessing new launches comprising amenities — rich group housing, independent floors and gated plotted developments, which meet the demands of the new-age homebuyer.

Prices inch up

In H1 2023, the average residential prices rose by 5 percent YoY over H1 2022. Steady homebuying demand coupled with new inventory launched at higher prices led to this price growth.

New launches in Gurugram see a big jump

High residential demand has also revitalised the new launch activity in Gurugram. In H1 2023, new launches in Gurugram comprised 82 percent of NCR’s total launch pie, swelling from a mere 19 percent share in H1 2021 as many new projects have been launched in the developing peripherals.

In H1 2023, new residential launches took place in Sector 53, 63, 76, 77, 79, Badshahpur, 37D, 93, 103 and 111.

Launches reduce in Noida and Greater Noida

From the perspective of half-yearly sales and launches, Noida and Greater Noida’s share in NCR’s total sales volume has been declining sequentially since H2 2019. From 71 percent in H2 2019, the share declined to 42 percent in H1 2022 before further reducing to 32 percent in the current half-yearly period.

The non-availability of ready-to-move-in inventory in key micro-markets of Noida situated closer to Delhi and a dearth of new launches by credible developers in both these cities have been key factors behind the rationalizing of its share in NCR’s total sales.

During H1 2023, Noida and Greater Noida’s cumulative share in NCR’s new launches remained limited at 13 percent, although in H1 2022, it accounted for a 26 percent share in NCR’s new launches. During H1 2023, new launches took place in Techzone IV, Sector 12 and Sector 16 B in Greater Noida. In Noida, Sector 94 and Sector 150 witnessed a few new projects being introduced in the market.

“Despite the changing situation regarding higher house loan interest rates, NCR recorded the second-largest growth in residential sales during the first half of 2023. The NCR market is still being driven by high consumer demand despite a number of challenges. However, any further increase in mortgage rates and real estate costs will affect consumer confidence,” said Mudassir Zaidi, Executive Director – North at Knight Frank India.