Chennai, Oct 1

Chennai’s residential market recorded a marginal growth of two per cent in home sales at 3,685 units in September 2022 quarter as compared to 3,610 units in September 2021 quarter, according to a report by Knight Frank India

Along similar lines, the supply of new residential projects witnessed marginal growth of three per cent year-on-year in Q3 of 2022, accounting for 3,912 of new homes during the quarter. The city witnessed a surge in price growth with aggregate residential value moving up by six per cent YoY during Q3 2022.

In September 2022 quarter, Chennai recorded office space transactions of 1.8 mn sq ft, posting an increase of 12 per cent YoY. The city recorded a substantial 374 per cent YoY growth in new completions; with 1.1 mn sq ft of new space getting added during the quarter. The average rental value in the office market witnessed an increase, growing by 5 per cent YoY during Q3 2022, said the report.

Housing growth at 15 pc in Q3

The residential sector in the country saw annual growth of 15 per cent in Q3 2022 to 73,691 housing units across the top eight cities in the country from 64,010 in Q3 2021.

This is a 20 per cent rise with regard to the quarterly average sales observed during the pre-pandemic times of 2019. While the sales volumes remain robust, they have dipped by 8 per cent compared to the preceding quarter. Considering the steady upward trajectory that sales have stayed on over the past four quarters, this modest dip is not a matter of concern.

The demand momentum was strong in Q3 2022 with sales in all markets, except Kolkata, growing on a YoY basis. A similar robust activity was observed in new launches growing 15 per cent YoY to 69,687 units in Q3 2022. All markets saw average prices increase in the range of 3-10 per cent YoY during this period, it added.

“All real estate asset classes have been on the recovery path over the past few quarters; however, the recovery in the residential segment was the swiftest and most substantial. While the increasing interest rates will impact affordability, the underlying need for home ownership remains strong. We do not believe that home loan rates approaching 2019 levels will be enough to subdue market momentum significantly,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India.

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