COVID-19 second wave: Housing sales dip 58 per cent in top 7 cities

  

 Housing sales in top 7 cities in April-June quarter 2021 (in Units)

Cities	Q2 2021	Q1 2021	Q2 2020
NCR	3,470	8,790	2,100
MMR	7,400	20,350	3,620
Bengaluru	3,560	8,670	2,990
Pune	3,790	10,550	2,160
Hyderabad	3,240	4,400	660
Chennai	1,590	2,850	480
Kolkata	1,520	2,680	730
Total	24,570	58,290	12,740

Source: ANAROCK Research

 

The ferocious COVID-19 second wave has significantly slowed down the housing sales in the April to June quarter of 2021 compared to the January to March quarter of 2021 but top seven cities showed an 93 per cent increase over the April to June quarter of 2020, according to the latest report by Anarock Property Consultants released today.

Mumbai Metropolitan Region which had reported sales of 20,350 units in Q1 of 2021 – thanks to the 2 per cent stamp duty cut in Maharashtra – reported sales of just 7400 units in Q2 of 2021. However, compared to 3,620 units sold in Q2 of 2020, the sales were more than double. Pune sold 3,790 units in Q2 compared to 10,550 in Q1 of 2021 and just 2,160 in Q2 of 2020. Mumbai and Pune accounted for 46 per cent of the total sales of 24,570 units across top seven cities. The top 7 cities had sold 58,290 units in Q1 of 2021 indicating the extent of recovery from the 2020 national lockdown.

Meanwhile, despite localized lockdowns and restrictions due to the second wave, developers launched new projects (mostly digitally) and put approximately 36,260 units on the market across the top 7 cities. Hyderabad is the frontrunner in overall housing launches with approximately 8,850 units launched in Q2 2021  followed by MMR with 6,880 and Bengaluru with 6,690 units. The top 7 cities launched around 36,260 new units in Q2 2021 compared to 62,130 units in Q1 2021 - a decrease of 42 per cent Q-o-Q due to the COVID-19 second wave. In Q2 2020, a mere 1,400 units were launched across the top 7 cities.

Anuj Puri, Chairman, Anarock Property Consultants, said, “The second COVID-19 wave definitely impacted overall residential property market activity in the second quarter of this year when juxtaposed against the preceding quarter. However, compared to the corresponding period of 2020, the sector displayed remarkable resilience. To the backdrop of developers adopting technology in their businesses, there was a huge yearly jump in both new launches and sales. Importantly, the localized lockdowns and restrictions did not dent activity as much as the complete nation-wide lockdown last year.”

He observed that the listed developers increased their market share slightly compared to the smaller, unorganized developers during the second wave – from 40:60 earlier to 43:57 now. “Back in FY2017, the ratio was 17:83. The impact of the second wave was felt more intensely by smaller and unorganized players,” he said.

Puri said with downward curve of second wave, easing of restrictions across cities and vaccination drive gathering momentum, he expected residential housing demand to see steady growth in the next quarter. “The previously-noted structural shift in housing demand continues - many current homeowners seek to upgrade to larger homes and the previously purchase-averse millennials remain very active property buyers,” he said.

The slowing down of sales also led to a 2 per cent increase in unsold inventory in Q2 of 2021.  Unsold inventory increased from 6,41,860 units in Q1 2021 to approximately 6,53,540 units in Q2 2021.. However, the two major realty hotspots - MMR and NCR - saw their unsold stock decline by 6 per cent and 1 per cent respectively.