Bull Run for Luxury Homes in Q3 But Demand for Affordable Homes Slows: Report

The luxury home market has rebounded sharply since the COVID-19 pandemic and over a quarter of houses in the top 7 Indian cities were under the luxury category in Q3 2023, according to a latest report from ANAROCK.

Just in 5 years, the supply share for luxury homes has increased three-folds to 27% compare to just 9% in 2018 with Hyderabad churning out the most of the supply with 14,340 units, the report shows.

The supply trend in top tier cities shows that Chennai is the only city to see a drop in new luxury supply between Q3 2023 and Q3 2018. All other cities saw a spike in this period.

City	Luxury Supply in Q3 2023	Luxury Supply in Q3 2018
NCR	3,870	930
MMR	7,830	2380
Bangalore	1,710	290
Pune	1,940	80
Hyderabad	14,340	210
Chennai	460	580
Kolkata	1,030	120
Total	31,180	4,590

Source: ANAROCK Research

"Developers have been bullish about the luxury homes segment because of its superlative performance after the pandemic, with overall sales rising steeply across the top 7 cities. Post pandemic, homebuyers have been seeking bigger homes and apart from high-end amenities and good location, luxury housing is primarily defined by generous floor space, said Prashant Thakur, Regional Director & Head - Research, ANAROCK Group.

"In the pre-COVID edition of the survey (H1 2019), 9% respondents preferred luxury homes priced more than Rs 1.5 cr while in the current edition of H1 2023, this share has risen to 16%."

While luxury homes supply continues its bull-run, affordable housing which are under Rs 40 lakh has reduced further to 18% in Q3 2023. Of approx. 1,16,220 affordable homes launched in the quarter, approx. 20,920 were in the affordable category.

Top 7 Cities	Q3 2023	Q3 2022	Q3 2021	Q3 2019	Q3 2018
Total Units Launched	1,16,220	93,490	64,560	45,220	52,120
Affordable Units Launched	20,920	16,828	15,494	18,540	21,900
Affordable % Share	18%	18%	24%	41%	42%

Source: ANAROCK Research