Uncompleted residential apartments in Greater Noida, near New Delhi. Photo: AFP

India’s housing sales are showing signs of revival, although demand is yet to reach pre-Covid levels. However, the threat posed by the Omicron variant could also upset the nascent recovery.

According to property consultant Anarock, housing sales across the top seven cities rose 71% year-on-year in the 2021 calendar year. However, it was nearly 10% lower than 2019.

Anarock attributed the rise in housing sales to low-interest rates on home loans, pent-up demand and a surge in aspiration for homeownership. Some lenders are offering home loan rates below 7% and the central bank has also kept the repo rates low at 4% for the ninth time in a row – more than 18 months.

Interestingly, the October-December quarter contributed nearly 39% to overall sales during 2021, on festive demand and other positive factors like the tapering of Covid-19 cases and the lifting of travel and business curbs across the country.

According to Anarock’s annual data, housing sales in the Mumbai Metropolitan Region, which covers most parts of India’s commercial capital Mumbai, rose 72% to 76,400 units in 2021 from 44,320 units in the previous year.

Sales in the South Indian cities of Hyderabad, Bangalore and Chennai, which also has offices of prominent technology companies, rose impressively. Bangalore saw a 33% increase in sales to 33,080 units in 2021 from 24,910 units the previous year.

Sales in Hyderabad jumped nearly three-fold to 25,410 units, mainly on account of a low base last year (8,560 units). A similar situation prevailed in Chennai, which registered an 86% growth to 12,530 units in 2021, from 6,740 units in 2020.

Delhi-NCR, which covers India’s capital New Delhi, saw a 73% rise in sales to 40,050 units in 2021, from 23,210 units in 2020. Housing sales in Pune increased 53% to 35,980 units in 2021 from 23,460 units in 2020. In Kolkata, sales increased to 13,080 units in 2021 from 7,150 units in 2020.

New launches

As for project launches, Anarock said they rose 85% across the seven cities against the previous year. In terms of new launches, India has edged past pre-Covid 2019.

In the Mumbai market, new launches rose 88% to 56,880 units in 2021 from 30,290 units the previous year. In Hyderabad, it jumped more than two-folds to 51,470 units in 2021 from 21,110 units the previous year.

The Delhi market saw a 71% rise in fresh housing supply at 31,710 units in 2021 from 18,530 units in 2020. New launches in Pune went up 67% to 39,870 units in 2021 as against 23,920 units the previous year.

In Bangalore, new projects witnessed a 43% rise to 30,650 units in 2021, from 21,420 units the previous year. The new launches in Kolkata jumped nearly four times to 13,750 units in 2021 from 3,530 units the previous year. Chennai saw a 35% increase in new launches to 12,370 units in 2021, as against 9,170 units the previous year.

Omicron wave

However, an Omicron wave in the coming months could halt the current recovery. India officially has nearly 1,500 confirmed Omicron cases across the country, but health experts fear the actual number may be much higher.

According to official figures, Omicron cases were less than 2% of India’s total Covid cases. This percentage could rise in the coming days.