Unveiling India's Residential Market Trends: Key Insights from 2024

The year 2024 witnessed a remarkable surge in housing sales across India's eight major cities, breaking records and redefining residential market dynamics. A recent Knight Frank report reveals that housing sales soared to a 12-year high, fueled by stable mortgage rates, robust economic growth, and an intensified demand for premium homes.

Record-Breaking Sales in 2024

Housing sales across the top eight cities surged to 350,613 units in 2024, up from 329,097 units in the previous year. This impressive growth reflects a booming real estate market with Mumbai taking the lead. The city recorded the highest volume of sales at 96,470 units, a 4% increase year-on-year.

In contrast, Bengaluru observed a modest growth of 2%, with 55,362 units sold, marking a 10-year high for the city. Meanwhile, Hyderabad and Pune reached all-time highs with 36,974 units and 52,346 units sold, respectively.

Emerging Cities Steal the Spotlight

Smaller cities also made their mark, with Kolkata and Ahmedabad showing significant growth:

• Kolkata: 16% year-on-year growth, selling 18,462 units.
• Ahmedabad: 15% rise, recording 17,389 units sold.

Premiumization and Price Segmentation

The trend toward premiumization has gained momentum, reshaping the housing market landscape. Key insights include:

• ₹1-2 crore segment: Constituted 27% of total sales, growing by 15% YoY with 90,814 units sold.
• ₹2-5 crore segment: Witnessed the highest growth at 82%, with 49,398 units sold, contributing 14% to the overall market.
• ₹10-20 crore segment: Sales rose 53% YoY to 1,240 units, with NCR, Mumbai, and Hyderabad leading the segment.
• ₹20-50 crore ultra-luxury category: Grew by an astounding 85%, with Mumbai dominating 78% of sales.

The Rise of Premium Homes

Shishir Baijal, CMD of Knight Frank India, highlighted a noticeable shift toward higher-ticket homes. "Two years ago, properties priced at ₹40-50 lakh were considered burdensome. Today, homes worth ₹1-1.5 crore are the norm in markets like NCR, with inventory moving significantly into premium categories."

For instance, NCR witnessed a 717% YoY growth in the ultra-luxury segment priced over ₹50 crore. Similarly, the ₹10-20 crore category saw a 44% YoY rise, underscoring the increasing preference for premium housing.

Price Appreciation Across Cities

Bengaluru led the market in price appreciation, recording a 12% YoY increase in residential property prices. Hyderabad and Chennai followed with price hikes of 8% and 7%, respectively. Mumbai, however, set a 12-year high for price per square foot at ₹8,277

Drivers of Market Growth

Stable home loan rates, rising urban incomes, and India's strengthening economic fundamentals continue to encourage homebuyers. These factors, coupled with the launch of more premium projects, have elevated average prices across cities.

Looking Ahead

The residential market in 2024 has set a robust foundation for future growth. As premiumization trends continue, cities like Mumbai, Bengaluru, and NCR are poised to remain leaders in the luxury housing segment. Rising incomes, stable mortgage rates, and the aspirational lifestyle of buyers will likely sustain this momentum.