Bengaluru, Pune drive real estate growth in India

Ahmedabad and Hyderabad posted highest increase in previous eight quarterly sales.

Signalling a revival in India’s sluggish residential realty market, the residential sales in India’s top nine cities increased by 8 per cent during the April-June quarter of this financial year as compared to a 3 per cent drop reported during the last quarter of FY16.

The surge in sales volume was primarily driven by Bengaluru, Pune and Mumbai, which together accounted for 61 per cent of the total sales across the top-9 cities in Q1 FY17.

According to Prop Tiger, sales across top-9 Indian cities increased from 51,500 units in Q4 FY16 to 55,550 units in Q1 FY17. Cities like Ahmedabad and Hyderabad reported their highest quarterly sales in the past 8 quarters.

There was also a price increase in these cities with Hyderabad witnessing the highest annual price appreciation of 8 per cent. The quarter also saw a reversal of sales trends in northern cities like Gurgaon and Noida. Both the cities made a strong comeback with Noida reporting its highest sales in four quarters and Gurgaon recording the highest sales in the last seven quarters.

The government’s policies and schemes to boost affordable housing seem to be giving results now. The new launches also went up by 14 per cent in Q1FY17 to 41,000 units compared to 36,000 units in the previous quarter. According to Prop Tiger could be attributed to the recent sops offered by the government for development of affordable housing as more than 50 per cent of total launches were witnessed in the affordable segments. “The first quarter of FY17 has started on a positive note for residential markets with rise in sales by 8 per cent. “Fence-sitting end users are beginning to enter the market with cities such as Ahmedabad and Hyderabad showing positive growth. With 14 per cent growth in new launches across top cities, the worst seems to be behind us,” said Dhruv Agarwala.