The Indian residential real estate market has witnessed an unprecedented upswing in fiscal year 2024 (FY24), recording an impressive 29% growth. This surge is highlighted by a notable 20.1% year-on-year (YoY) increase in the area absorbed across the nation. The robust demand has been matched by an 11.5% YoY rise in new supply; however, inventory levels in key urban centres have dwindled to a historic low of 12 months, signalling a market under significant pressure from ongoing demand.
The average residential property prices have escalated by 9.0% YoY, driven by both price hikes and a favourable product mix. This has contributed to the sector’s overall growth, with pre-sales for major listed developers surging by a remarkable 39.5% YoY. This substantial increase underscores the growing market share of Tier 1 developers and a heightened consumer preference for premium and branded residential offerings. Mumbai Metropolitan Region (MMR) has been a standout performer, with a 20.4% YoY boost in sales despite a slight 3.5% decline in new launches. Residential prices in Mumbai have experienced a compound annual growth rate (CAGR) of 7.7% from FY20 to FY24, reflecting strong demand in the premium segment.
Bengaluru has also demonstrated impressive growth, with a 18.1% YoY increase in sales for FY24. The city absorbed 102.7 million square feet (MSF) against 95.9 MSF launched, reducing unsold inventory by 8.3% to 75.1 MSF. Residential prices in Bengaluru have grown at a CAGR of 10.7% over the past four years, indicative of sustained demand and a vigorous market. In contrast, the National Capital Region (NCR) faced a slight 10.2% YoY decline in sales during the final quarter of FY24, although it still achieved a 10.9% YoY increase for the full fiscal year, with 79.4 MSF sold. Hyderabad saw a substantial 28.0% YoY increase in sales for FY24, driven by a strong 20.0% rise in the fourth quarter alone.
Chennai, however, experienced a 9.5% YoY decline in sales in the last quarter of FY24, despite a dramatic 50.0% YoY rise in new launches. The city reported a 7.9% YoY increase in sales for the year, with a 7.4% CAGR in property prices from FY20 to FY24. Looking ahead, Propequity projects an 18% growth for the market in FY25, encompassing a 12% rise in volume and a 6% escalation in prices. Despite moderate increases in supply, inventory levels are anticipated to remain balanced due to robust absorption rates, ensuring continued market vitality.
