According to a recent report by CBRE South Asia, housing sales increased by more than 75% year over year in the top seven cities in H1 2021.
Pune led sales activity with a 26% share, followed by Mumbai (19%). Hyderabad and Delhi-NCR were closely followed with 18% and 17% of the market share, respectively.
Anshuman Magazine, Chairman, India & South-East Asia, Middle East & Africa, CBRE told the media that In India, the residential segment has played a significant role in the growth of the real estate sector. The initiatives taken by the federal and state governments have been critical and commendable for the residential sector's revival.
Housing sales have been boosted by policy initiatives from the federal and state governments, as well as lower lending rates, according to the report. To boost housing sales, states such as Karnataka, Telangana, Maharashtra, and Tamil Nadu have implemented stamp duty reductions and property tax rebates.
Since 2010, while property prices have grown at a CAGR of 1 to 6% in the high-end segment and around 2 to 7% in the mid-segment, per capita GDP has grown at a CAGR of 4% between 2010 and 2020.
Although the residential sector is showing signs of recovery, developers are still dealing with issues such as limited credit availability, tax and regulatory complexities, and construction delays due to reverse migration labour shortages (though abated to a large extent), Higher input costs are leading to higher construction costs; several developers' highly leveraged balance sheets have added another layer of difficulty to the sector.
Also read: Housing sales fall by 58% in 2021: PropEquity
