India’s residential real estate market has achieved a significant milestone, with inventory overhang — the time required to sell unsold properties — dropping to a historic low of 22 months in the June 2024 quarter, compared to 34 months in the same period last year. This improvement highlights strong demand in the sector, with regional variations. Delhi-NCR reported the highest inventory overhang at 31 months, while Kolkata had the lowest at 16 months.
Key cities like Gurugram and Ahmedabad showed remarkable progress, with Gurugram's overhang reducing from 72 months to 31 months, and Ahmedabad’s from 33 months to 18 months. Despite slower new supply, the market remained resilient, with unsold inventory decreasing by 2% year-on-year to 9.26 lakh units by June 2024.
According to Vikas Wadhawan, Group CFO of REA India, the reduction in overhang indicates sustained demand in the residential sector. With the festive season approaching, further growth in market activity is expected. Nationally, inventory overhang improved, with cities like Bangalore and Ahmedabad reducing their overhangs to 18 months, while Kolkata saw a significant drop to 16 months.
Ahmedabad led in reducing unsold units, followed by NCR, while the Mumbai Metropolitan Region and Pune accounted for 54% of the unsold inventory across top cities. The MMR saw a slight 1% increase in unsold stock due to strong demand leading to more project launches. Overall, the market continues to show positive demand trends, with inventory levels improving across many regions.
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