Bengaluru emerges as the forefront of residential sales in India in Q1 2024

• Mid-segment apartments (INR 50-75 lakh) constituted the largest portion of quarterly sales, accounting for approximately 33%.
• Premium category apartments (INR 1.0-1.5 crore) closely followed with a 23% share in sales. 
• New launches in Q1 2024 increased by 9% compared to the previous quarter, totalling 12,616 units. 
• Whitefield led the way in new launches, contributing 37% of the total, while Hosur Road and Bellary Road submarkets also made significant contributions. 
• The premium segment (apartments priced between INR 1.0-1.5 crore) held a dominant 43% share in quarterly launches, followed by the upper-mid segment (INR 75 lakh-1.0 crore) with a 22% share. 
• Due to high demand and limited supply, prices and rents experienced a positive trajectory. 
• On average, capital values increased by 3.5-4.5% quarter-on-quarter in Q1 2024 and 15% compared to Q1 2023.

Bengaluru, April 15, 2024: Bengaluru has once again dominated the Indian real estate market by achieving the highest total sales of housing units for two consecutive quarters. The capital city of Karnataka witnessed a phenomenal performance in Q1 2024, with a staggering 16,995 housing units being sold. While there was a 15% decline in Quarter-on-Quarter sales (Q4 2023, which previously set a record with approximately 20,000 units sold), the city showed an impressive bounce-back in Q1 2024, recording a remarkable 30% growth in sales compared to the same quarter in the previous year (Q1 2023). The Q1 2024 data was not just notable on a quarterly basis but have also surpassed the quarterly average sales volume (Q1 average 2019-22) by an astounding 124%. Bengaluru's real estate market continues to attract investors and homebuyers due to its robust infrastructure, thriving IT sector, and conducive business environment. The city's ability to surpass previous sales records, even in the face of challenges, reaffirms its position as a highly sought-after destination for real estate investments and home purchases.

The mid-segment apartments, priced between INR 50-75 lakh, accounted for the highest share of nearly 33% in quarterly sales. This was closely followed by the premium category apartments, priced between INR 1.0-1.5 crore, which held a 23% share.

“An interesting trend indicated that approximately 90% of the sales were in under-construction projects, signalling strong buyer confidence in such developments. Furthermore, the unsold inventory continued to decline, showcasing a 6% and 20% decrease compared to Q4 2023 and Q1 2023, respectively. The total unsold inventory stood at 72,158 units by the end of Q1 2024. In terms of specific locations within Bengaluru, Whitefield emerged as the forerunner, capturing a substantial 34% share in sales. This was followed by the Bellary Road submarket, which held around 27% share. The proximity of Whitefield to the IT hub and the extension of the metro network have fuelled increased sales in the area. On the other hand, projects in the Bellary Road submarket have benefited from their proximity to the airport,” said Rahul Arora, Senior Managing Director – Karnataka, Kerala, JLL India

Additionally, new launches during the quarter increased by 9% compared to Q4 2023, with a total of 12,616 units introduced to the market. Here, Whitefield took the lead once again, contributing 37% of the new launches. Hosur Road and Bellary Road submarkets also made significant contributions. In terms of segments, the premium segment, consisting of apartments priced between INR 1.0-1.5 crore, held a dominant 43% share, followed by the upper-mid segment, priced between INR 75 lakh-1.0 crore, with a 22% share in quarterly launches. Reflecting the high demand, prices and rents have experienced a positive trajectory. On average, capital values increased by 3.5-4.5% quarter-on-quarter in Q1 2024 and 15% compared to Q1 2023. Notably, the recent extension of the Namma Metro network to Whitefield resulted in the highest residential price growth in that submarket. Hosur Road also witnessed significant capital value increases following the government's approval of Phase 3 of Namma Metro, which will connect the submarket with the Kempegowda International Airport.

^{Source: Real Estate Intelligence Service (REIS), JLL Research}

Driven by supply from established developers, stable economic conditions, and positive buyer sentiments, residential sales in the first quarter (Jan-March) of 2024 experienced significant growth. The first quarter of 2024 (Q1 2024) achieved the highest residential sales to date, with a notable 20% increase compared to the same period in 2023, selling a total of 74,486 units. This quarter marks the second consecutive quarter where sales have exceeded 74,000 units, following the record-breaking performance in Q4 2023 (75,591 units). These results establish a strong foundation for continued growth in the residential market, surpassing the sales performance of 2023.

India’s residential market – Scaling new heights.

^{Source: Real Estate Intelligence Service (REIS), JLL Research.Note: Mumbai includes Mumbai city, Mumbai suburbs, Thane city, and Navi Mumbai; Delhi NCR includes Delhi, Gurugram, Noida, Greater Noida, Ghaziabad, Faridabad and Sohna.}

^{Data includes only apartments. Rowhouses, villas, and plotted developments are excluded from our analysis.}

“The quarterly sales were majorly contributed by the markets of Bengaluru, Mumbai, and Pune accounting for ~64% of the total sales. All these three cities saw robust launches that received good response from the buyers. While Bengaluru and Pune recorded highest sales in the INR 50 lakh-75 lakh price segment, Mumbai saw maximum sales in the INR 1.5 crore-3 crore price segment. 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. Interestingly some of the branded developers are also planning to enter newer markets and cities to expand their portfolio and market share” said Dr. Samantak Das, Chief Economist and Head of Research and REIS, JLL India.

Luxury segment soars, pushing up quarterly sales.

^{Source: Real Estate Intelligence Service (REIS), JLL Research}

Residential prices in the top seven cities of India have been on an upward trajectory in Q1 2024, with increases ranging from 3-15% Year-on-Year (Y-O-Y). The highest price increase was witnessed in Bengaluru and Delhi NCR to the tune of ~15%. Due to the faster pace at which quality launches are getting sold off, the availability of such inventory is extremely limited, resulting in a surge in prices. Additionally, developers are launching new phases of existing projects at elevated price points.

Q1 2024 saw the highest number of new launches ever recorded in the previous first quarters.

^{Source: Real Estate Intelligence Service (REIS), JLL Research}

The first quarter of 2024 witnesses a record-breaking number of residential launches with 79,110 units, surpassing the previous Q1 numbers. This represents a Y-O-Y growth of 5%. Developers have readjusted their marketing strategies, leading to a noticeable surge in the number of high-value projects being launched. Approximately 37% of these new launches were in the price bracket INR 1.5 crore and above.

As of Q1 2024, unsold inventory across the seven cities increased by 1% on a Q-o-Q basis as launches outpaced sales. Mumbai, Bengaluru, and Hyderabad together account for 66% of the unsold stock. An assessment of years to sell (YTS) shows that the expected time to liquidate the stock has remained same at 2.1 years in Q1 2024.

In 2024, we expect the residential sales to be around 300,000-315,000 units as the growth momentum currently seen is expected to be carried forward. Strategic land acquisitions at prime locations as well as along growth corridors in cities is expected to strengthen the supply inflow across cities. Established developers are expected to enter newer markets to fortify their portfolio and expand their market presence.

JLL is India’s premier and largest professional services firm specialising in real estate. The Firm has grown from strength to strength in India for the past two decades. JLL India has an extensive presence across 10 major cities (Mumbai, Delhi NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata, Ahmedabad, Kochi and Coimbatore) and over 130 tier-II and III markets with a cumulative strength of over 14,000 professionals. The Firm provides investors, developers, local corporates, and multinational companies with a comprehensive range of services. These include leasing, capital markets, research & advisory, transaction management, project development, facility management and property & asset management. These services cover various asset classes such as commercial, industrial, warehouse and logistics, data centres, residential, retail, hospitality, healthcare, senior living, and education. For further information, please visit jll.co.in