Sales of apartments in Nagpur market doubled post Covid-19

While primary market sales almost doubled in Nagpur, the unsold inventory has also gone up from 11,556 units in 2019-20 to 14,300 in January 2024. (Representational image)

The Nagpur real estate market has witnessed a surge in sale of residential homes in the primary market post Covid-19. The number of apartments sold in the primary market have almost doubled in the orange city from 1,383 in 2019-20 to 2,211 in 2023-24, up to January 2024, according to data collected by Liases Foras, a real estate research firm.

Primary sales stood at 1,383 units in 2019-20, valued at Rs 486.32 crore. It  went up to 1,563 units in 2020-21 valued of Rs 539 crore, according to the data.

Further in 2021-22, the units sold stood at 2,332 at a value of Rs 833 crore, followed by 2,543 units in 2022-23 valued at Rs 1,207 crore, and 2,211 in 2023-24 (up to January 2024) having a value of Rs 1,257 crore.

What is the primary market?

Primary market is where homebuyers purchase directly from a developer in an under construction or ready-to-move-in apartment. On the other hand, the secondary market is when homebuyers purchase resale properties from home-owners upgrading or investors exiting their investments.

Related stories

Mehul R Thakkar

Special Correspondent|Moneycontrol

• 
  New players have entered Mumbai real estate market and we welcome their presence: Abhishek Lodha
• 
  Mumbai real estate market records 9% rise in property registrations this month
• 
  MahaRERA tells developers to declare parking space details to homebuyers

Unsold inventory

While the number of primary market sales almost doubled in Nagpur post Covid-19,  unsold inventory has also gone up from 11,556 units in 2019-20 to 14,300 in January 2024. The value of unsold units in 2019-20 stood at Rs 4,125 crore and has now gone up to Rs 6,605 crore in January 2024 for 14,300 units.

The average cost of an apartment in Nagpur city also went up in the span of five years from Rs 35 lakh in 2019-20 to Rs 46 lakh in 2023-24.

Why are sales up?

"Post Covid-19 the sales or property registrations in the Mumbai real estate market also doubled and have seen healthy growth. We are seeing a similar pattern in the Nagpur real estate market, which is not a surprise. Post Covid-19, there was a lot of migration towards tier-2 and tier-3 cities, and this resulted in demand for residential, commercial and retail witnessing healthy growth,” Pankaj Kapoor, Managing Director, Liases Foras, said.

Aditi Sirsikar, Director, Sirsikar Developers & Builders Private Limited, said that post the Covid-19 pandemic, a notable shift has occurred, as a considerable number of young individuals have decided to either return to their hometown Nagpur  from other cities, or embrace hybrid work arrangements, allowing them to work remotely. This influx of young talent has led to a socio-economic evolution within Nagpur city, he said

"Right now, we are experiencing unprecedented momentum in various sectors not only in commercial establishments and rental properties but also in entrepreneurial activities with ventures coming up across different industries. This dynamic transformation is not only reshaping the economic landscape of Nagpur but also positioning it as an increasingly attractive hub for investment and development, which is also helping the real estate sector," Sirsikar added.

More demand for 3 and 4 BHK apartments

According to developers, the majority of the demand in the Nagpur real estate market is for 3 and 4 BHK apartments as 1 and 2 BHK apartments have taken a back seat post Covid-19.

"There are two reasons for the sales doubling in the Nagpur real estate market post Covid-19. The first reason is the infrastructure boost that the city has got in the last five years, including the Nagpur Metro rail, road, flyovers etc. This has made life easy and also brought in a lot of business activities. The second reason is that post Covid-19 and during Covid-19 many of the youngsters who were in Mumbai, Pune, Hyderabad etc, came back during lockdown, and ended up staying here," said Kishore Kanhere, Founder and Chairman of Ankit Construction.

"Further, the migration of a young population also resulted in demand for 2 BHK apartments going down followed by demand for 3 and 4 BHK apartments picking up. The majority of the homebuyers are in the age group of 30 to 45 years of age, and as they shifted back to their home-towns, commercial and retail businesses also got a boost. Prior to Covid-19, the malls that were operational were running at a loss but today we have four to five prominent malls in the city that are doing pretty well when it comes to revenue," Kanhere added.

Also read: Nagpur developers to team up to build city’s first co-working space

Meanwhile, in a report released in March 2023, Magicbricks, an online home search portal had said that units sized 1,000-1,500 sft are highly preferred, which also correlates to the high demand for 3BHKs in Nagpur.

In terms of micro markets, the report had said that Manish Nagar, MIHAN, Wardha Road, Besa and Narendra Nagar are the top five searched localities in Nagpur, indicating homebuyers’ inclination towards the southern part of the city. Over the last five years, localities in South Nagpur have recorded rate appreciation in the range of 9-12 percent, the report said.