Pune’s residential market is considered to be amongst the most exciting markets in India. This holds true for both its performance and potential for future growth as well. When we examine Pune’s housing market over the last five years, we see consistent year-on-year sales growth, which shows us clearly that there’s a lot of valuable traction here. So much so that 2022 promises to be the year where Pune best shows its potential. Let’s cover how 2022 will beat the last 5 years in terms of home sales in Pune.
The total number of residential units sold in Pune during 2016 was 4,128,302 and this indicates to us that a promising start has been made in terms of what can possibly be achieved going forwards. We are also looking forward to finding out how far Pune’s residential sector has progressed by 2022.
The housing market of Pune witnessed a slight decline. The key factors that contributed to this trend were demonetization, RERA, and a slower market. During H1 2017 (January – June) there were about 33,970 units sold. Budget houses remained the preferred option for home buyers as compared to luxury high-end houses that fell down in price. The average cost of homes stood at Rs 49 lakhs in the mid-year period.
There were over 33,000 newly launched homes in 2018. Asking prices for these properties fell by $10,000 on average. This means that the cost per square foot of newly developed flats and apartments also fell slightly.
Pune saw a reduction in the number of homes sold. With inventory levels still high, developers were unable to launch as much new stock this year. This also coincided with an economic slowdown and budget homes under Rs 60 lakh remained the most popular option for homebuyers who were looking for a good investment opportunity. Western Pune ultimately saw higher sales due to commercial expansion but this was offset by an increase in property tax along with a cancellation of a land tax rebate.
The real estate market suddenly fell into a dip due to the Indian government’s move towards implementing an anti-black money currency policy. Sales were kept in check because no one wanted to risk buying and investing their hard-won cash given how their wealth might not be worthwhile anymore within months.
Pune experienced the highest drops with only 9,412 units being sold within Q3 alone. While this was already quite low on its own, new launches remained at 7,563 units – making it drop even further on a national level. Other quarters fared worse however as people just weren’t willing to invest given fears that they wouldn’t be able to keep their investment safe if they did so given how rapidly the value of their money could become worthless overnight if they got caught up in such a situation.
In the second half of the year 2021, new launches grew 26.3% on a year-on-year basis to 12,558 units. Sales decreased 20.6% to 16,220 units on account of the severity of the second wave of the pandemic as buyers mostly preferred bigger configurations than before. 2 BHKs took 72% and 3 BHKs took 19% shares. The budget segment of small individual homes less than Rs 70 lakhs saw its share fall to 63%, marking a rise in sales of higher ticket size homes due to preference for community living.
Pune is a great city for real estate investors, who can expect price increases of 17% during 2017-2021, which will boost prices from 9200 INR\1200 Square Feet to 10500 INR\1250 square feet. 2022 will be a great year for Pune homeowners looking to buy property, as market prices in the area currently average about 9000 INR\1120 Square Feet and are predicted to rise to 11000 INR\1150 Square Feet. This means that by 2022 it should be much easier and cheaper to find real estate deals in Pune!
Pune can expect close to 40,000 housing units to be sold within its city limits in 2022 as long as COVID regulations remain intact. Should this prove impossible, Pune’s annual sale rate will go above 50,000 home sales by 2022. But at this rate, the industry expects around 40,000 total home sales for the city for that year. Home prices are likely to exceed the 2017-2021 estimated average of around Rs 15,000 crore per year and reach close to Rs 20,000 crore annually across 2022.
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