Home sales volume across eight major cities shot up 2.5 times to 33,403 units in Q3 2020 (July-September) compared to 9,632 in Q2 2020 (April-June), consultancy firm Knight Frank India said in a report on Thursday.
New residential unit launches increased by 4.5 times to 31,106 units in Q3 2020, compared to 5,584 units in the previous quarter. The eight cities include Mumbai, Delhi NCR, Kolkata, Chennai, Bengaluru, Hyderabad, Pune and Ahmedabad.
Shishir Baijal, Chairman and Managing Director, Knight Frank India, said, "Developers have been focusing on liquidating inventory and homebuyers inclined to purchase ready assets has translated into reduced unsold inventory levels in this quarter. For markets such as Mumbai and Pune, the additional push by the state government in the form of reduced stamp duty has helped in demand generation and revenue creation for the state government. Going forward, the festival season will be crucial for developers."
However, on a year-on-year basis, residential sales reached 54 per cent of 2019 quarterly average while launches in Q3 2020 improved to 56 per cent of the 2019 quarterly average.
Weighted average prices in Q3 2020 registered a Y-o-Y decline in the range of 3%-7% in six of the eight markets. Hyderabad and Bengaluru were the only markets that witnessed a price increment of 4 per cent and 3 per cent YoY respectively, as developers in these predominantly end-user markets sustained pricing power in a favourable demand-supply scenario, the report said.
Mumbai's residential sales improve exponentially in Q3 2020 due to reduced stamp duty regime, the report said. Mumbai, Bengaluru and NCR accounted for 56 per cent of the quarterly sales volume during Q32020 compared to 62 per cent in 2019, primarily due to a fall in Bengaluru's share in total sales for the same period.
"Even while there is a considerable distance from normality, the residential sector has started to show signs of improvement in Q3 2020," the report said.
In the commercial space, the report observed that gross office leasing across these cities witnessed a strong recovery, registering 80 per cent growth to 0.44 mn sqm in Q3 2020. New office completions during the same period, reported recovery of 126 per cent to 0.33 mn sqm, compared to Q2 2020.
Year-on-year basis, office transactions of the eight markets in Q3 2020 reached 33 per cent of the 2019 quarterly average level. New completions also improved to 29 per cent of the 2019 quarterly average.
Rajani Sinha, Chief Economist and National Director - Research, Knight Frank India said, "While work from home as a concept has proved to be an effective business continuity measure; we expect occupiers to look at office space usage more strategically."