January 10, 2024: The residential sector saw sales of over 2,71,800 units across the top seven cities of India -Mumbai, Delhi-NCR, Bangalore, Hyderabad, Chennai, Kolkata and Pune in 2023, says a recent JLL report. The report highlighted that 2023 became the best year for the residential market as it surpassed the previous peak of 2010 by 25%. On a y-o-y basis as well, 2023 sales were up by 26%, with every quarter performing better than the previous one. The fourth quarter of the year saw stupendous sales with 75,500 units sold during the quarter, making it also the best performing quarter ever.
New sales peak seen every quarter in residential market
Sales (no of units)
| Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | 2023 Full Year |
| 62,040 | 64,547 | 69,640 | 75,591 | 2,71,818 |
The tech driven cities have seen impressive annual growth led by heightened sales activity. “The tech cities of Pune, Chennai, Bengaluru and Hyderabad witnessed a remarkable growth in sales as compared to the previous year. The significant upside in the sales in 2023 reflects the innate potential of these markets. The demand is primarily driven by an increasing return to office in the IT/ITeS sector and expansion of global firms and Global Capability Centres (GCCs) along with setting up of new ones. Additionally, the quality supply brought in by prominent developers has pushed up the sales in these cities to a large extent,” said, Samantak Das, chief economist and head research & REIS, India, JLL.
| Sales (No of units) | 2022 | 2023 | y-o-y growth (%) | % Share in 2023 |
| Bengaluru | 46,649 | 62,583 | 34% | 23% |
| Chennai | 9,318 | 12,758 | 37% | 5% |
| Delhi-NCR | 38,356 | 38,407 | 0% | 14% |
| Hyderabad | 24,263 | 32,530 | 34% | 12% |
| Kolkata | 14,619 | 13,491 | -8% | 5% |
| Mumbai | 46,734 | 59,448 | 27% | 22% |
| Pune | 35,682 | 52,601 | 47% | 19% |
| India | 215,621 | 271,818 | 26% | 100% |
“The overall sales across the top seven cities picked up significant momentum in the second half of the year. It is pertinent to note that both mid-market and premium segments have contributed jointly 23% each to drive the sales in 2023. Delhi-NCR and Mumbai have seen the maximum sales in the premium segment (apartments priced above Rs 1.5 crore). There is a rising demand for bigger homes with premium amenities and support infrastructure. Delhi-NCR saw some prominent launches in the premium segment that were sold out completely within few days. Around 45% of the annual sales in Delhi -NCR during the year was contributed by the premium segment. With the unchanged repo rate, robust supply pipeline announced by established developers and steady land acquisitions taking place in the last one year, the market reflects positive outlook for 2024” said Siva Krishnan, managing director and head, Residential Services, India, JLL.
According to the report, the premium segment (apartments priced above Rs 1.5 crore) share in annual sales has increased from 19% in 2022 to 23% in 2023. In fact the premium segment has also emerged as a leader in terms of absolute apartment units sold during the year surpassing every other price segment. Also, apartments priced less than Rs 75 lakh, has seen a perceptible decline in share.
| Ticket Size Break Up (Rs) | Share of sales | Share of sales |
| 2022 | 2023 | |
| Less than 50 lakh | 22% | 18% |
| 50 lakh- 75 lakh | 28% | 23% |
| 75 lakh – 1 crore | 16% | 17% |
| 1 crore- 1.5 crore | 15% | 19% |
| Above 1.5 crore | 19% | 23% |
| Total | 100% | 100% |
Prices move northwards
In 2023, there has been a rise in residential prices across the top seven cities of India in the range of 4-16% y-o-y. Bengaluru has seen the maximum rise to the tune of 16% followed by Delhi-NCR at 12%. The increase in prices is seen across the spectrum of projects that have high demand and less ready-to-move inventory. New phases of existing projects are also getting launched at higher prices.
Highest ever new launches recorded in 2023
Residential launches in 2023 at 2, 94, 330 units are the highest ever surpassing the previous high of 2, 81, 000 units in 2010. Compared with the previous year, new launches in 2023 witnessed a growth of 19% y-o-y.
| Cities | 2022 | 2023 | % Share in 2023 | Y-o-Y growth (%) |
| Bengaluru | 48,412 | 47,156 | 16% | -2.6% |
| Chennai | 7,111 | 15,656 | 5% | 120.2% |
| Delhi-NCR | 13,554 | 22,707 | 8% | 67.5% |
| Hyderabad | 55,232 | 57,317 | 19% | 3.8% |
| Kolkata | 10,342 | 9,189 | 3% | -11.1% |
| Mumbai | 63,600 | 77,694 | 26% | 22.2% |
| Pune | 49,027 | 64,613 | 22% | 31.8% |
| India | 247,278 | 294,332 | 100% | 19.0% |
Developers have realigned their marketing strategies based on the current market dynamics, and this is clearly getting reflected in increasing number of launches in the higher ticket size projects. Around 33% of the launches in 2023 were in the price bracket of above Rs 1.5 crore.
Unsold inventory declines in Delhi-NCR and Bengaluru
On a y-o-y comparison, larger residential markets of Delhi-NCR and Bengaluru saw a decline in their unsold inventory levels by 19% and 16.8%, respectively.
An assessment of years to sell (YTS) shows that the expected time to liquidate the stock has declined by eight months from 2.9 years in Q4 2022 to 2.1 years in Q4 2023, an indication of robust sales growth.
Outlook
Despite higher level of home loan interest rates during 2023 and prices moving northwards, homebuying mood remained upbeat, a big thumbs up to the domestic sentiment. Finally, as per the report, the growth trajectory is likely to continue in 2024 and the JLL report expects the residential sales to be around 3,00,000-3,15,000 units (10-15% Y-o-Y growth), with the assumption that India’s current GDP growth would sustain with a range bound inflation in the economy and a decrease in home loan interest rate by 40-50 bps during the year. Strategic land acquisitions at prime locations as well as along growth corridors in cities is expected to strengthen the supply inflow across cities.
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