Home sales in 2024 across the top eight cities reached a 12-year high while office sector saw a record leasing in the year, but a worrying trend is builders focusing more on the premium segment in which certain price categories are seeing an inventory overhang with supply outstripping demand.
Over 3.5 lakh homes were sold in 2024 in the top 8 cities of India, up 7 per cent on year, according to Knight Frank India. The growth was led by Kolkata, Ahmedabad and Mumbai which saw double digit increases. The exception was the National Capital Region which saw a 4 per cent dip in sales.
Inventory fell to a 12-year low at 5.8 quarters to sell while the maximum sales growth was seen in the ₹2-5 crore segment.
Mumbai accounted for 27 per cent of total sales during the year at close to 96,200 units. Bengaluru saw the least growth of 2 per cent and sales of over 55,300 units.
Housing supply
Housing supply was ahead of demand with new launches at 3.73 lakh units in 2024, up 6 per cent on year, Knight Frank data showed.
Pune accounted for the most growth in launches at 40 per cent, while NCR, Hyderabad and Ahmedabad saw a fall in launches.
In Mumbai, sales and launches were almost level.
Prices across cities continued their upward trajectory ranging from 2 to 12 per cent over a 12-month period in the second half of the year.
Premium residences
For the first time the data had an in depth analysis on the luxury and premium segments, which is seeing the most demand.
In the price range of ₹5 to 10 crore over 11,300 units were sold, an increase of 46 per cent on year, while those in the range ₹10-20 crore rose 53 per cent to 1,240 units.
The ₹20-50 crore segment showed robust sales growth mainly in Mumbai and Hyderabad, but there is also an inventory overhang with the number of quarters to sell at around 20 or five years.
In that category, launches outstripped sales by a wide gap and unsold inventory showed a spike in Mumbai. In Mumbai the value of the unsold inventory in this category was ₹14,911 crore and for homes above ₹50 crore the unsold inventory was worth ₹12,712 crore.
Office demand
Office leasing in 2024 rose by a fifth on year and reached a record level of 72 million square feet, the report said, surpassing the previous peak of 61 msf seen in 2019.
The leasing was driven by Bengaluru, with a fourth of total transactions concentrated in the city, led by Indian facing businesses and Global Capability Centres as the top occupiers.
India facing businesses were responsible for 36 per cent of total leasing, followed by GCCs at 31 per cent. Leasing by flex operators rose 52 per cent to 15.7 msf and third-party IT services leased around 8 msf.
Bengaluru saw 18 msf of leasing, up 45 per cent on year. It was followed by Mumbai and NCR. Chennai and Kolkata saw a fall in transactions.
New office supply rose 17 per cent to a little over 50 msf.
