The inventory of unsold affordable houses has been shrinking over the last two years as the new supply slows down.
The number of unsold affordable houses in the top seven cities of the country declined by 21 percent–from 2,34,600 units in the first quarter of 2020 to 1,86,150 by the end of Q1 2022, data shared by real estate consultancy Anarock shows.
"Affordable housing took the biggest hit from the pandemic, with the first perceivable change being its declining share of new supply,” Anarock Group chairman Anuj Puri said on April 19.
As many as 6,27,780 units lie unsold across the seven cities. Of these, 1,86,150 houses are in the affordable segment, priced at Rs 4o lakh and above, alone. The decline is on account of intentional restrictions on the new budget housing supply.
"Data reveals that out of approximately 70,480 units launched in the top 7 cities in Q1 2019, affordable housing had a 44 percent share. This segment's supply share has been declining y-o-y, reducing to 38 percent in Q1 2020 and further to 30 percent in Q1 2021. In Q1 2022, its share of new supply had declined to 25 percent,” Puri said.
Of the top seven cities, Chennai saw the sharpest decline in unsold houses at 52 percent—from 9,220 units in Q1 2020 to 4,440 in Q1 2022. Pune witnessed a 33 percent decline from 46,630 units in Q1 2020 to 31,090 houses in Q1 2022, data shows.
In Mumbai Metropolitan Region, unsold affordable houses declined to 50,860 units by Q1 2022, a 27 percent drop from 69,210 units in Q1 2020.
The National Capital Region saw its unsold affordable housing stock decline by 13 percent to 56,280 by Q1 2022. In Bengaluru, the inventory shrank 10 percent— from 14,700 units in Q1 2020 to 13,200 units in Q1 2022.
“Restricting new affordable housing supply has helped developers clear previous stock of unsold budget homes by at least 21 percent in the top 7 cities," Puri said.
This was the biggest supply reduction among all budget categories, clearly reflecting an enduring demand for affordable homes, he said.
Ultra-luxury, too, find buyers
The unsold stock of the ultra-luxury homes—priced below Rs 2.5 crore—in the top seven cities saw a 5 percent decline during the period, from 41,750 houses in Q1 2020 to 39,810 units by Q1 2022.
MMR and Kolkata saw the biggest drop, shedding 16 percent and 15 percent, respectively.
The premium and luxury segments (Rs 80 lakh to Rs 2.5 crore) witnessed an increase in unsold stock in the same period. NCR had 7,980 such houses in Q1, 2022, MMR 20,480 units and Bengaluru 3980 units.
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