The property market of Pune has always been a force to reckon with in the overall Indian real estate sector. This holds even truer for the city’s housing market. The kind of demand, supply, and traction that Pune has seen in its residential segment over the past many years goes on to say volumes about both its potential and performance.
We look at the performance of the Pune housing market over the last 5 years. We also discuss how 2022 is likely to fare in terms of housing sales and traction. We will, in the process, establish how the best is yet to come for Pune’s housing market.
The period of 2017-2021
In 2017, housing sales in Pune saw a slight dip, as also the new launches. A slower market, demonetization, and RERA were the key factors contributing to this trend. With around 33,970 units sold in 2017, the residential market dipped 16% in H1 (January – June) on a year-on-year basis. Budget and value segment houses remained the preferred option for home-buyers, while luxury and the high-end market fell down. The average cost of a home stood at Rs 49 lakhs.
2018 saw new launches shoot up with a mammoth rise of 157% year-on-year. 33,521 units were sold and effectively, housing sales fell marginally by 1% as compared to 2017. Even the asking prices saw a moderate, downward correction of 3%.
In 2019, Pune saw housing sales of 32,810 units. This was the year of consolidation as new launches were restricted to offload the inventory overhang of around 96,000 units. It was also the time of economic slowdown and again, budget houses in Rs 25 lakhs – 60 lakhs price range remained the most preferred option. Western Pune saw a rise in sales on account of commercial expansion. A 5% hike in housing tax coupled with the cancellation of 4% rebate on property tax kept sales from marching up.
Preferred residential pockets in central Pune were Koregaon Park and Kothrud. In the west, Hinjewadi, Wakad, and Aundh were the most popular ones, while Kharadi, Wagholi, and Hadapsar ruled the east. Up north, Moshi, Pimpri, and Chinchwad were preferred over other localities, while Undri and Ambegaon were preferred down south.
2020 saw housing sales decline to 26,919 units. The COVID factor had come into the picture and sales stood well below 30,000 for the first time in 5 years. Still, Pune registered the highest sales across India in Q3 2020 at 9,412 units. New launches at 7,563 also remained the highest in Q3, which formed a matter of pleasant surprise. Other quarters saw subdued activity on account of COVID and lockdowns.
In the yet-to-end 2021, new launches during H1 grew 26.3% on a year-on-year basis to 12,558 units. Sales dipped 20.6% to 16,220 units on account of the severity of the second wave of the pandemic. In a shift of preference, most buyers preferred bigger configurations than before, with 2 BHKs taking 72% and 3 BHKs taking 19% shares.
The budget segment of value less than Rs 70 lakhs saw its share fall to 63%, marking a rise in sales of higher ticket size homes. Community living, thus, is being preferred over individual housing and small society living. As things stand, northwest Pune comprising of Baner, Balewadi, and Mahalunge is selling around 26% of the total housing units, followed by 23.5% in Pimpri-Chinchwad.
With Rs 850 per square feet average housing price drop registered during 2017-2021, marking a 17% downward correction to Rs 4,010 per square feet, buyers in Pune have good reason to cheer. 2022 presents a golden opportunity for Pune buyers to book a house for themselves at a price that would make them smile and that too without cutting deep into the pockets of project developers.
Pune can expect well around 40,000 housing units to be sold in 2022. If COVID subsides, it won’t be a matter of surprise to see this number reach close to even 50,000. Still, 40,000 remains a realistic housing sales estimate for the Pune market. Value-wise, housing sales are likely to surpass the 2017-2021 expected annual average of around Rs 15,000 crore to cross the coveted Rs 20,000 crore mark across 2022.
2022 is indeed likely to breach several existing Pune housing market records, as also set newer benchmarks in terms of projects, locality, neighborhood, configuration, amenities, infrastructure, connectivity, and more such options that buyers look at before purchase and developers look before investment. In case you are looking to settle down in Pune any time soon, look out for 2022 as an opportunity to exercise your decision smartly.