Home sales recover, drive up prices in second half of 2020 – Times of India

Kolkata: Sales of homes and apartments have made a smart recovery in July-December 2020 after plummeting to historic low in the January-June period, primarily owing to the lockdown that led to zero sales in April and a few sales in May and June. The sales, driven by pent-up demand and an increased awareness on the necessity of a home in the wake of the pandemic, also led to a recovery in prices in the October-December quarter.
The largest real estate consultants operating in Kolkata has recorded a 79% bookings growth in October-December 2020 compared to the same period last year. NK Realtors said it had received confirmed bookings for more than 800 units during the period, up from around 450 units in the corresponding period in 2019. In December 2020, the company recorded bookings of nearly 300 units, up from around 240 in December 2019.
“For us, the October-December quarter in 2020 has been way better than the July-September quarter with sales up nearly 10%,” said Biplab Kumar, vice-president at NK Realtors.
Global real estate consultants Knight Frank that released its report on the sector’s performance in the second half of 2020 on Wednesday said the third quarter sales in Kolkata market had been better than the corresponding quarter in the previous year. Against 3,041 units sold in July-September 2019, the industry recorded sales of 3,921 units in July-September 2020. In October-December period though, sales declined from 3,637 in 2019 to 2,054 in 2020.
The second half was much better than the first half. According to the report, 5,975 units were sold in the second half of 2020, up from 2,937 in the first half, a jump of 103%. In units priced up to Rs 50 lakh, sales have increased from 2,019 units in the first half of 2020 to 3,286 in the second half of 2020, an increase of 63%.
The resurgence in sales in the second half of 2020 compared to the first half has led to a 14% decline in inventory. “With hardly any new launches in 2020, inventory has reduced. I think the demand will remain firm this year and will lead to an upward price correction around July-September 2021,” said Nandu Belani, president of the Bengal chapter of the Confederation of Real Estate Association of India (Credai).
Credai president (West Bengal) Sushil Mohta said price of real estate in pockets of Kolkata had gone up by 5% in December and expected a further price correction of 10% by March. “Post pandemic, developers were apprehensive about sales and focused on ongoing projects. This has reduced inventory and is now leading to a price correction in the market,” he said. Overall, price of residential real estate has gone up from Rs 3,095 per square feet in the first half of 2020 to Rs 3,202 in the second half.
“There is a definite shift in end-user preference with home buyers looking for bigger accommodations,” said Knight Frank Kolkata branch director Swapan Dutta. At the same time, the maximum traction was in ready-to-move-in homes within Rs 50 lakh.