The IRIS index closed at an all-time high in September 2021. The India online property search volume moved up five ranks to reach 116 points post the second wave of the pandemic – a faster resurgence compared to the same period in 2020.
Online activity of high-intent buyers looking for buying a house post the second wave corroborates with the overall market sentiments. Positioned on the path of speedy recovery, leading economic and consumption indicators in India have all been pointing at a much robust comeback unlike the first wave. Manufacturing and services PMI, employment, GST collections, credit growth, fuel and power demand are seen to have bounced back quicker than the first wave, thus bolstering consumer sentiments across sectors.
Bearing testament to the speedy recovery, where manufacturing and services PMI scaled back to the expansion zone in five months post the first wave, these indicators were quick to come in the expansion zone after the uncertainty seen in May 2021.
The improving consumer sentiment has also trickled down to residential real estate, where the IRIS index has seen a sharp upswing post the second quarter (April–June 2021), sustaining itself above the 100-mark.
Our consumer sentiment survey indicates a strong homebuyer outlook for the coming six months, where high-intent homebuyers express confidence regards the overall economic scenario and their income stability. The positive consumer outlook coupled with Reserve Bank India (RBI)’s accommodative stance, historic low interest rates, discounts and flexible payment plans has all contributed towards optimism in the sector which in turn has redefined the IRIS index peak in September 2021.
A deeper look into the homebuyer activity suggests maximum search volume in the 2 BHK and 3 BHK configuration, with majority of the searches lying in the less than INR 50 lakh price bracket, closely followed by the INR 50 lakh–1 crore price bracket.
It is also interesting to note that the share of search queries for 3BHK and 3+BHK has recorded a constant increase in online property search volume, reflecting the shifting preferences amid the pandemic where homebuyers are exploring upgrading to larger configurations owing to the work-from-home.
Surat, Patna and Coimbatore emerge as gainers in the top-20 cities witnessing maximum online property search volume in September 2021
Surat recorded the highest jump in rank amongst the top-20 cities with maximum high-intent homebuyer activity in India. Its position improved by six points as the city reached the fourth rank with maximum search queries recorded for apartments in the micro locales of Vesu and Dindoli. The majority of the homebuyers in Surat are searching for apartments with the 2 BHK configuration in the price bracket of less than INR 50 lakh. Following the lead to Surat, Patna and Coimbatore registered an improvement of four positions each.
In Patna, most of the search queries are concentrated in localities such as Danapur and Phulwari Sharif. Maximum homebuyers in Patna are looking for residential plots, whereas apartments with the 2 BHK configuration are most searched in Coimbatore. In case of Coimbatore, Saravanampatty and Vadavalli have recorded majority of queries for buying a home. Most of the searches in both cities are concentrated in the less than INR 50 lakh price category.
The formalisation of work-from-home in many business organisations has provided the workforce flexibility to shift their base to their hometowns and smaller cities with low cost of living and affordable residential options compared to metros.
Kolkata registered the highest decline in online search volume
Kolkata’s slipped by five ranks in September 2021, reaching 16th position. While Kolkata maintained its position in the top-10 cities recording maximum high-intent homebuyer activity till May 2021, the uncertainty over the West Bengal Housing Industrial Regulatory Authority (HIRA) and delay in the resumption of consumer redressal commission has impacted consumer sentiments in the city since June of this year. However, with the on-going festive season, it will be interesting to see how the demand undercurrents influence Kolkata’s ranking in the coming months.
Delhi NCR continues to take the top spot on the index. The agglomeration has been topping the high-intent homebuyer activity since June 2021. Delhi NCR has been plagued with various woes of litigations, unsold inventory and trust deficit in the past which derailed the residential realty momentum of the region. The sustained online homebuyer search activity is the leading indicator of the improving sentiments in one of the largest residential markets in the country. The coming months will present a clearer picture of the conversion of the building up search queries.
A deep dive into the market reveals that in Gurugram, micro-markets of Sector 57 along Golf Course Extension Road and Sector 67 along Sohna Road have seen heightened online search activity for buying a house. Most of the potential homebuyers in these micro markets are looking at apartments with good infrastructure and connectivity in the price bracket of INR 1–2 crore. In Noida, most of the online property search activity was concentrated in sectors along the Noida-Greater Noida Expressway such as Sector 150 and Sector 137, with consumers preferring apartments in the 2 BHK and 3 BHK configuration in the price range of INR 50 lakh–1 crore. Noida Expressway due to its connectivity and the now functional metro has been garnering a lot of interest for office leasing which in turn is cascading into residential demand along the expressway.
In the case of Greater Noida, most of the search queries were for buying residential plots. The upcoming international airport in Jewar and the proposed metro extensions have contributed towards building positive consumer sentiments around the region.
For most homebuyers, the buying process starts with searching the desirable residential properties online. Such home search queries take around two to three months to translate into the actual purchase. IRIS index, which gauges the residential property movement through online property search volume, is thus a leading indicator to assess the upcoming residential demand. The index that peaked in September 2021 signals a positive turnaround for the residential realty market for the ensuing months.
Renuka Kulkarni, a seasoned real estate professional, brings over five years of diverse experience in research, consulting, and architectural design within the urban sector. Her expertise spans public and private projects, showcasing proficiency in real estate research, trend interpretation, and policy analysis. With qualifications in architecture and a master’s degree in Data Science (Business Intelligence & Data Analytics) from IIIT Bengaluru, along with an M. Tech in Urban Development and Management from TERI School of Advanced Studies, New Delhi, Renuka seamlessly blends data analytics with market insights, offering a holistic understanding of the industry in her research pieces.
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