These top 8 cities are Mumbai, NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata, and Ahmedabad.
Residential sales:
As per the data, residential sales of these 8 cities stood at 312,666 units registering a growth of 34% YoY. Mumbai led the market with sales of 85,169 units up by 35% YoY followed by NCR and Bengaluru which recorded sales of 58,460 units and 53,363 units increasing by 67% and 40% year-on-year respectively.
Apart from Kolkata, which saw a slowdown in sales of residential by 10% YoY in 2022, all markets registered growth in both sales as well as new launches, Knight Frank's report said.
Notably, the second half of 2022 which is from July to December was the second-best half-yearly period following H1 2022 in terms of sales volume in the last 9 years.
During H2FY22, the top eight cities recorded a sales volume of 153,961 units -- recording a growth of 15% YoY. The report said, with central banks raising policy rates to fight inflation, and making mortgages more expensive, residential markets in India saw a marginal sequential decline in volumes.
Furthermore, in H2 2022, Mumbai posted the highest sales of 40,969 units accounting for 19% YoY growth. In percentage terms, Hyderabad witnessed the highest home sales growth of 32% YoY followed by Ahmedabad and NCR up by 25% YoY and 24% YoY.
Shishir Baijal, Chairman and Managing Director, of Knight Frank India said, “The residential sector was an exceptional story of growth in 2022, as despite numerous inflictions, the pace of growth remained largely intact. This momentum is the result of a definitive shift in attitude in favour of home ownership that has ignited the latent demand."
Baijal explained that the shift is so strong that despite some worsening in affordability on account of rising home
loan interest rates, sales momentum has remained buoyant. Demand for homes has been further strengthened by continued economic growth, financial and income stability, and moderately growing prices.
In terms of sales, these top 8 markets made new launches to the tune of 328,129 units -- registering a growth of 41% YoY. Mumbai continued to dominate the market even in new launches with 90,434 units followed by NCR and Bengaluru with new launches of 63,233 units and 43,420 units respectively in 2022. In terms of percentage, NCR registered the highest growth of a whopping 207% in new launches followed by Kolkata up by 64% YoY, while Bengaluru and Ahmedabad with a growth of 42% YoY each. Notably, Kolkata made the lowest new launches of 12,330 in unit terms.
Office leasing:
According to Knight Frank's data, top office markets of India registered total gross leasing activities of 51.6 mn sq ft in 2022 which was higher by 36% YoY over last year. This is historically the second-best year for office transaction volume with the peak achieved in 2019.
In terms of the office space demand, Bengaluru led with 14.5 mn sq ft followed by NCR with 8.9 mn sq ft transacted area in 2022.
Knight Frank explained that while the last quarter of the year was marred with some uncertainty owing to global economic disruptions, the stronger domestic economic environment allowed the office market to remain buoyant. Additionally, as more corporations push for a return-to work policy, demand for office has been steadily rising.
Also, new completions also rose in 2022 with 49.4 Mn sq ft of new office space delivered recording a YoY rise of 28%. Bengaluru (15.6 mn sq ft), Hyderabad (11.2 mn sq ft), and NCR (7.9 mn sq ft) were the top markets to receive new office spaces.
Baijal said, the office market has made a significant recovery in 2022 despite concerns of a looming recession in the developed economies. The evolution of the office as an enabler of productivity continued with more corporations recalling their staff to the office. The addition of staff, especially by Indian corporations also added to office space demand in 2022. However, occupiers increasingly favoured flexibility which in turn has helped managed office spaces to recorded substantial growth in 2022.
He added that the uncertainty in the global economies is expected to continue for a couple of more quarters which can cause sentiments to remain subdued while corporations work towards realigning around the same, post which we can expect an uptick in leasing activities. Having said that, the domestic economy is expected to remain in growth mode which should help office space maintain a healthy momentum.
In 2023, Baijal believes the pace of sales to remain unchanged in the new year, as most parameters are expected to remain favourable, including levels of inflation that are expected to start stabilising by mid of the current year.
