Bengaluru, July 25, 2024: In Q22024 (April-June), Bengaluru performed remarkably well in terms of launches. With 16,537-unit launches, the city held the highest share (~21%) in pan India Q2 supply, and it has achieved this premier position for the first time, post Q32018 (July-September). A total of 29,153 unit launches in Bengaluru during H12024 (Jan-June2024), has recorded a 26% Y-O-Y growth and has also been the highest ever half yearly supply in the city. The city held a share of around 18% in H1 2024 pan India launches, next to Mumbai and Hyderabad. Interestingly, the unit launches in H124 (29,153 units) have already reached ~60% of the highest ever annual launches seen in the city during year 2022. Sustained demand for property in Bengaluru supported by the booming IT sector, infrastructure upgradation programmes and conducive business environment has been attracting several national and regional developers to the city, resulting in healthy launches every quarter.
The upper-mid segment, consisting of apartments priced between INR 1.0 – 3.0 crore, held a dominant share of ~63% in Q2 as well as H1 2024 launches. However, on a half-yearly basis, it was the premium segment (priced between INR 3.0-5.0 crore) launches that recorded a remarkable Y-O-Y growth of more than 200% when compared to H1 2023, largely driven by healthy launches by reputed developers.
“Whitefield continues to hold its dominant position driven by its office sector expansion and recent extension of the Namma Metro network and led the Q2 city launches contributing a share of ~47%. The corridor connecting Whitefield to Kempegowda International Airport through Budigere Cross has attracted several reputed developers who have announced projects largely within a ticket price range of INR 1.0-3.0 crore. Besides, a significant share in Q2 launches, the submarket as well contributed for ~57% of Bengaluru’s quarterly sales. Consequently a 14% Q-O-Q decline in its unsold inventory speaks about a healthy balance in its supply and demand,” said Rahul Arora, Senior Managing Director – Karnataka, Kerala, JLL India.
Robust buyer interest in projects launched over the past six months drives sustained sales momentum.
Bengaluru continues to dominate the Indian residential sector demand. With a sales volume of 18,548 units during Q2 2024, the city stands out to be the highest contributor (~23% share) in both quarterly and half yearly housing sales in India. The city recorded a remarkable 33% Y-O-Y growth in half yearly sales.
“Interestingly, around 25% of Bengaluru’s H1 2024 sales were contributed by projects launched during the first six months of the year, signalling strong buyer confidence in such developments. Despite the sustained surge in launches, Bengaluru’s remarkable performance in sales has resulted in a sharp 40% Y-O-Y decline in terms of months to sell, coming down from 23 months by end Q2 2023 to just 14 months at present,” said Dr. Samantak Das, Chief Economist and Head of Research and REIS, India, JLL
Similar to launches, the upper-mid segment, consisting of apartments priced between INR 1.0-3.0 crore, held a dominant share of ~47% in H1 2024 sales. However, it was the premium segment (apartments priced between INR 3.0-5.0 crore) that recorded a remarkable Y-O-Y growth of around 175% when compared to H1 2023, complementing the healthy launches in the segment.
Residential prices on an upward trajectory
In H1 2024, the average price in Bengaluru experienced a Y-O-Y increase of nearly 15%. The surge in prices can be attributed to the launch of premium projects at higher rates and the faster pace at which quality launches are getting sold off in the city, particularly in Whitefield and North Bengaluru markets. The strategic launch of right products by the developers taking into cognizance the demand and market dynamics has led to this new growth phase in the residential market.
Unsold inventory drops perceptibly by end H1 2024
As of H1 2024, unsold inventory in Bengaluru deceased by ~21% on a Y-O-Y basis as sales outpaced launches. The total unsold inventory stood at 70,147 units by end H1 2024. One of the factors contributing to this drop in unsold inventory can be ~31% of the H1 2024 launches being sold out during the same period. With anticipated momentum in the coming quarters, the months to sell for the available inventory are likely to decline further in the near to medium term.
Driven by surge in supply from established developers, stable economic conditions, and positive buyer sentiments, residential launches, and sales in the first half (Jan-June) of 2024 experienced significant growth. These results establish a strong foundation for continued growth in the residential market, surpassing the traction witnessed during 2023.
