The Indian residential real estate market recorded a 31% drop in sales across Tier I and II regions in 2020, going by a report.
Housing sales dipped to 2.62 lakh units in 2020, as per the report by real estate consultancy Liases Foras.
The drop was more pronounced in Tier I regions that saw sales of 1.85 lakh units in 2020 compared to 2.74 lakh units in 2019. The decline was less severe across Tier II cities where sales dropped from 1.02 lakh units to 76,600 units during the period.
Tier I regions include Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, MMR, NCR and Pune.
Sales are picking up on a sequential basis. As per the report, Tier I cities recorded sales of 52,727 units in October-December, a 25% growth compared to the previous quarter.
To be sure, the residential market was going through a tough phase even before the pandemic, owing to various factors such as GST, RERA and demonetisation.
The IL&FS crisis and its impact on NBFCs – the main source of capital for developers until 2018 – also affected developers.
In recent times, developers such as Prestige Estates and Puravankara have launched a bunch of projects across cities anticipating an economic recovery.