Real Estate: House Selling Time Reduced by 31% in 2024 Vs 2019, Now At Just 22 Months

India’s residential real estate market is experiencing a notable transformation. According to a recent JLL report, the time required to sell the unsold housing inventory in the top seven cities—Delhi-NCR, Mumbai, Pune, Bengaluru, Chennai, Hyderabad, and Kolkata—has decreased significantly by 31% from 2019 levels. This shift marks a crucial development in the housing sector, reflecting a robust increase in demand and efficient inventory liquidation.

As of the first quarter of 2024, the average time to sell the existing unsold housing stock has dropped to 22 months, a substantial improvement from the 32 months recorded at the end of 2019. This improvement is attributed primarily to the exponential surge in housing demand observed over the past few years. The analysis is based on the average sales rates over the last eight quarters, underscoring a consistent positive trend in the market.

Over the past five years, from 2019 to Q1 2024, the residential sector has seen steady growth in housing launches, with nearly a million units introduced to the market. Consequently, the actively selling unsold inventory reached about 468,000 units by March 2024, marking a 24 per cent increase since December 2019. Despite this rise in inventory, the reduction in the time required to sell these properties highlights the market’s dynamic nature and strong buyer interest.

Samantak Das, Chief Economist and Head of Research & REIS, India, JLL, highlighted significant trends within various market segments. “Both the affordably priced (up to INR 75 Lakh) and premium (INR 1.5 crore to 3 crore) segments have seen a sharp decline of around 43 per cent in the time needed to sell their unsold inventory. The affordable segment’s reduction is due to its decreasing share in new launches, while the premium segment saw a significant drop in selling time despite a rise in its share of annual launches from 2 per cent in 2019 to 22 per cent in 2023. The premium segment’s inventory liquidation time fell from 51 months in 2019 to 29 months in Q1 2024, showcasing strong sales momentum in this category," Das said.

Interestingly, the premium segment still takes the longest time to sell its unsold inventory, averaging 29 months as of Q1 2024. Nevertheless, this segment has demonstrated a significant reduction in selling time, driven by fast sales velocity and increased buyer interest in larger homes with better amenities.

The trend of reduced selling time spans multiple cities. Delhi NCR, in particular, has seen the sharpest decline, with the time to sell unsold inventory dropping from 48 months in 2019 to just 14 months in Q1 2024.

Siva Krishnan, Senior Managing Director (Chennai & Coimbatore) and Head of Residential Services, India, JLL, attributed this to robust sales in the premium and luxury segments, noting that many quality projects in Delhi NCR are selling out within days of their launch. He anticipates further reductions in inventory liquidation time in the near to medium term as market momentum continues.

This significant reduction in unsold inventory selling time is a positive indicator for India’s residential real estate market, suggesting strong demand and efficient absorption of new and existing housing stock.