Housing Sales Rise By 14% In January-march

By Author: Dynamix Group
Total Articles: 23
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The first quarter of 2023 has been an interesting one for real estate, pan-India. For the first time since the Pandemic years, the industry has seen an increase in the year-on-year growth of 50% in residential real estate. Recent studies conducted on the housing sales rise presented that property in Mumbai and Pune contributed to approximately 50% of the overall nationwide sales of residential real estate in 2022. So why may that be so? We’re looking into the various factors that have contributed to the housing sales rise for this first quarter of 2023.

To evaluate the various reasons, it would be insincere to paint all the sales with the same brush, so we must first categorise the sales into various sub-segments of residential real estate, based on the price brackets and the subsequent influential factors.

Under 1 CR:

Affordable housing has not fared as successfully as mid and high-end units, for reasons we will address, however, that is not to say affordable housing was left untouched. News about a 1% increase in Stamp Duty that would come into effect from the start of the next financial year (i.e. from ...
... the 1st of April), swayed a lot of fence sitters. Not to say that an increase in cost does not affect everybody, but for those buying a 1 crore home, an increase of Stamp Duty from 6 to 7 lakhs, or 7 to 8 lakhs, can be an unforeseen impact on their budgeting.

Between 1 and 3 CR:

The Mid-Range housing has always been the sweet spot for most homeowners, here they are able to access the likes of a spacious 3BHK in Malad constructed by a renowned developer in Mumbai making the purchase of this particular property in question a far more lucrative business decision than purely a personal milestone to be achieved. In addition to the comfortable price point, within the 1 to 3 crore range, depending on the neighbourhood, one is able to afford a luxurious 2 BHK in Mumbai which has fast become one of the most sought-after configurations of homes in the city and the reason is obvious. The Pandemic years taught us the value of a home, and the value of our space. Today’s buyers are looking at homes through the possible lens of it doubling as a workspace, or a rent-yielding asset, or even the very real consideration of it being their safety. Having lived through the uncertainty of steady salaries, layoffs, and other financial and personal hurdles a large number of people found solace in that they knew they had a roof over their heads, and the privilege that they felt in having safety as basic as that, was not lost on them. Those young couples confined to their 1BHKs during Lockdown see the value and strength the space of a second bedroom can afford them and their relationship. The family that watched their child sit in their bedroom and attend virtual school for hours on end recognised the importance of a study so that there is a distinction between school/work and being at home. The new parents who couldn’t take their infants out for play time, found a way to transform their space for their baby’s benefit. People lost a lot during those years, and today people are preparing for a future where such an occurrence is once again a possibility, and this time, they’ll see it through with confidence.

Above 3 CR:

For those buyers who are looking at a high-end unit, such as HNIs, on a financial front, the introduction of changes to their Capital Gains Tax this April could very well be a motivator to push the fence sitters once again. As HNIs will see an increase in their taxation on their Capital Gains, people are more keen on investing their hard earned money elsewhere, rather than paying double the tax that they were due just before the Financial Year 23-24.

The ability to secure earnings in real estate has proven to be a large boost to the industry as well as a boon to buyers who are far more secure in their purchases today, owing largely to the RERA, their own personal experiences with the Pandemic, and subsequent growth each individual faced in their journey to their own security and needs.