Construction activity banned

Real estate trends in 2022

The year 2022 bids adieu in two weeks to welcome New Year 2023. Several interesting developments took place during the current year in real estate sector like reduction in the availability of affordable houses, launches of medium and premium segment projects, demand for rent going up, imposing ban on construction activity for some time to check pollution and so on.

The following are some of the significant issues that surfaced in the housing market in 2022:

Sale of housing units in the first three quarters in seven main cities of the country crossed 3.60 lakh. It is an all-time sales record. Tier-2 and Tier-3 towns and cities experienced strong demand for units from consumers. Besides improving sales of units, the residential segment witnessed a good number of project launches during 2022.
Increase in lending rates is one of the adverse aspects. Interest rate on housing loans went up by at least 2%. It would affect the demand for new houses in New Year. Availability of number of affordable housing units has come down in 2022. However,
the premium and middle range housing project launches have increased manifold. Prior to 2019, the share of the affordable units in housing sector occupied 40 per cent share with the availability of over 2,36,500 units. In the first three quarters of the current year, the share reduced to 21 per cent with the availability of only 2,65,000 units.

During the current year, the development of residential plots became popular with the people as they preferred to own individual houses, especially after the pandemic situation. This segment registered impressive sales during current fiscal year. The trend was noticed significantly in Bangalore, Chennai and Hyderabad.

The air quality index in national capital region of Delhi fell to dangerous levels, leading to suspension of housing construction activity this year. As employers have encouraged employees to work from offices, the demand for rent has revived. House rents have increased by 20-25 per cent compared to rents prior to the Covid-19.