Despite the spiralling COVID-19 pressures across the country, the Indian housing sector has made a comeback in Q3 2020 with sales and new launches rebounding to 65 percent and 79 percent, respectively, of the pre-COVID-19 levels (Q1 2020) respectively.
The top 7 cities recorded new launches of approximately 32,530 units in Q3 2020, nearly 79 percent of the pre-COVID (Q1 2020) launches at 41,220 units. However, there is a massive jump over Q2 2020 that saw merely 1,390 units being launched.
The top 7 cities witnessed housing sales of approximately 29,520 units in Q3 2020 as against 45,200 units in the pre-COVID-19 quarter of Q1 2020. Again, sales were significantly higher than the preceding quarter when the coronavirus pandemic had brought them down to just 12,730 units.
“MMR, Bengaluru, NCR and Pune altogether accounted for 84% sales in the July-Sept quarter. MMR saw maximum sales of 9,200 units, followed by Bengaluru with 5,400 units, NCR with 5,200 units and Pune with 4,850 units,” said Anuj Puri, chairman – ANAROCK Property Consultants.
“In terms of new launches, the top 7 cities witnessed supply of approximately 32,530 units in Q3 2020 as against 41,220 units in Q1 2020 – reaching over 79% of the pre-COVID-19 quarter levels. Cities like Hyderabad, Kolkata and NCR saw new supply increase during the quarter as against the first quarter of 2020. Most new launches in the quarter happened virtually,” he said.
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Key cities contributing to Q3 2020 new unit launches included MMR, NCR, Bengaluru, and Hyderabad, altogether accounting for 78 percent addition.
MMR saw approximately 7,890 units launched in Q3 2020 as against 10,490 units in Q1 2020 – reaching nearly 75 percent of pre-COVID first quarter. Over 53 percent of the new supply in this quarter was added in the sub Rs 80 lakh budget segment, while 28 percent new supply was added between Rs 80 lakh to Rs 1.5 crore budget segment.
NCR added approximately 6,810 units in Q3 2020 against 6,190 units in Q1 2020 - an increase of 10 percent. Over 76 percent of the new supply was added in the sub-Rs 80 lakh budget segment.
Bengaluru added new supply of approximately 5,840 units in Q3 2020 as compared to 8,600 units in Q1 2020 – thus touching 68 percent of the pre-pandemic quarter.
Hyderabad added approximately 4,900 units in Q3 2020, a significant increase of 45 percent over Q1 2020. Approximately 88 percent new supply was added in the sub-Rs 80 lakh price bracket.
Pune new launches rebounded to 54 percent of the pre-COVID-19 quarter with approximately 4,200 units being launched in Q3 2020.
Hyderabad, Kolkata and NCR saw their new supply increase by 45 percent, 24 percent and 10 percent, respectively during the period. The affordable and mid segments (priced up to Rs 80 lakh) comprised over 72 percent share (approximately 23,290 units) of the total new supply between July-September.
Currently, reduced stamp duty charges in Maharashtra coupled with developers’ incentives and rock-bottom home loan interest rates are a major attraction for homebuyers. This indicates that the upcoming festive season quarter (Oct-Dec) may see housing sales recover to almost the pre-COVID-19 levels.
Unsold inventory in the top cities shrunk by approximately 3 percent on a yearly basis – from 6.56 lakh units back in Q3 2019 to 6.36 lakh units in Q3 2020. It reduced by 1 percent between Q1 2020 and Q3 2020. On a yearly basis, Bengaluru saw the maximum reduction of 3 percent in its unsold stock – from nearly 62,800 units in Q3 2019 to approximately 60,820 units in Q3 2020.
Thus, despite the inexorable rise of COVID-19 cases, periodic local lockdowns across states and the traditionally inauspicious ‘shradh’ period, residential sales and new launches saw reasonable momentum in Q3 2020. On a q-o-q basis, the jump has been massive for both new launches and sales; the April-June quarter was more of an outlier with most activity at a standstill, the analysis said.
As far as sales are concerned, approximately 29,520 units were sold in Q3 2020 – rebounding back to 65 percent of the pre-COVID quarter (Q1 2020). NCR, MMR, Bengaluru, and Pune together accounted for 84% of the sales in the quarter. Interestingly, in comparison to the preceding quarter, sales have increased by over 132 percent in the top cities.
MMR saw nearly 9,200 units sold in Q3 2020 as against 13,910 units in Q1 2020 – sales effectively come back to 66 percent of the pre-pandemic quarter. Bengaluru recorded approximately 5,400 units sold in Q3 2020 against 8,630 units in Q1 2020 – regaining 63 percent of business.
NCR witnessed sales of 5,200 units in Q3 2020 against 8,150 units in Q1 2020 – 64 percent of the Q1 2020 levels.Pune saw 4,850 units sold in Q3 2020 as against 7,200 units in Q1 2020 – back at 67 percent of pre-pandemic levels.