Bengaluru and Delhi NCR require the least time to liquidate unsold housing inventory

The housing sector in India’s top seven cities, including Delhi NCR, Mumbai, Pune, Bengaluru, Chennai, Hyderabad, and Kolkata, has witnessed a surge in unsold inventory as also a 31% decrease in the time it will take to sell the active unsold housing inventory on the back of increase in demand, an analysis by JLL showed.

Bengaluru and Delhi NCR require the least time to liquidate their current active unsold inventory. (Representational Photo)

Bengaluru and Delhi NCR require the least time to liquidate their current active unsold inventory. In Bengaluru it took 13 months to sell unsold inventory as of March 2024, in Chennai it takes 20 months and Delhi NCR 14 months, the analysis showed.

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In Q1 (Jan-March) 2024, the time to liquidate inventory has dropped to just 22 months, compared to 32 months by the end of 2019, driven primarily by an exponential surge in housing demand. This assessment is based on the average sales rate observed over the last 8 quarters.

Also Read: Delhi-NCR’s unsold housing inventory reduces by 57%, Bengaluru’s unsold stock shrinks by 11% in 5 years

In the past five years (2019 – Q1 2024), the residential sector has witnessed a consistent growth in housing launches, with almost a million units launched during this period.

As a result, the actively selling unsold housing inventory has reached approximately 468,000 units by March 2024, marking a 24% increase since December 2019. However, despite this surge in unsold inventory, there has been a remarkable reduction in the estimated time required to sell these properties, the report showed.

Also Read: 74,486 housing units sold in Q1 2024; share of affordable housing sales decline

Both the affordably priced (apartments priced up to 75 lakh) and premium (apartments priced between 1.5 crore to 3 crore) segments have seen a sharp decline of around 43% each in the time needed to sell their respective unsold inventory levels.

While the fall in the former was due to its reducing share in launches over the last four years, the premium segment saw this decline despite a substantial jump in the segment’s share in annual launches – from around 2% in 2019 to 22% in 2023.

“The time needed to sell the unsold inventory in the premium segment has dropped from 51 months in 2019 to 29 months in Q1 2024, showcasing the strong sales momentum in this segment. Apartments belonging to ticket size category of 3.0 crore and above, have also witnessed a 11% reduction in time to sell during the same time,” said Samantak Das, chief economist and head research & REIS, India, JLL.

Also Read: Share of luxury homes’ sales now almost at par with affordable housing units

The analysis takes into account active unsold inventory which does not include projects which are on hold. 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. Row houses, villas, and plotted developments are excluded from our analysis.

Among all price categories, it is the premium segment that still takes the longest time to sell its unsold inventory, with an average of 29 months as of Q1 2024. However, despite this longer selling period, the premium segment has experienced a significant reduction in inventory liquidation time due to its relatively faster sales velocity.

This segment has emerged as the top performer, driven by strong buyer interest in larger homes with improved support amenities.

Time taken to liquidate the housing stock has declined across the majority of the cities like Delhi NCR, Bengaluru, Kolkata, Mumbai, and Pune between December 2019 and Q1 2024. Delhi NCR has recorded the sharpest decline in terms of months to sell, coming down from 48 months to just 14 months, the analysis showed.

“This can be attributed to robust sales in the premium and luxury segment in Delhi NCR with a lot of quality projects getting completely sold out within days of their launch. With anticipated momentum in the coming quarters, the months to sell for the available inventory are likely to decline further in the near to medium term.” said Siva Krishnan, Senior Managing Director (Chennai and Coimbatore), Head – Residential Services, India, JLL

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