India’s residential market is expected to sustain demand momentum despite rise in mortgage and property rates as sales this year across the top 7 cities are likely to breach pre-pandemic level of 2.62 lakh units, industry players said.
After braving four back-to-back disruptions in form of demonetisation, RERA, GST and Covid-19 in the last 6 years, industry experts feel the housing market is going through a lot of structural changes and is now at the start of a long-term upcycle.
Homebuyers body FPCE gives credit to the Real Estate Regulatory Authority (RERA) under the Real Estate (Regulation & Development) Act, 2016 for this improved buying sentiment.
All major listed real estate developers posted record sales bookings in the last fiscal and have given guidance that their sales numbers in FY’23 will be even better. However, if the overall market is taken into account and not just listed entities, the RBI’s decision to hike interest rates by a cumulative 140 basis points and banks passing on this increase to home loan borrowers have slowed down sales mometum slightly. Increase in housing prices also had some impact, according to industry experts.
Prices rose by an average 5 per cent annually in the June quarter due to higher input costs, especially that of cement and steel. But developers and brokers feel the increase is short-term and demand will pick up significantly from the festive season.