Pent-up demand drives up home prices in 2022

Hyderabad: The post-pandemic pent-up demand has defined the real estate purchase trend of 2022. This pent-up demand has driven up home prices, buying activity, and inflation in rent, says tech-based real estate platform NoBroker.com.

In its Annual Real Estate Report for the year 2022, NoBroker.com stated that 67 per cent of potential buyers stated that pandemic-induced insecurity positively impacted their home purchase decision.

Mapping 2022 for the country's real estate sector, the report broke down the key trends that defined the real estate sector by combining platform data of 30 million users with survey responses from over 26,000 customers across Bangalore, Mumbai, Pune, Chennai, Hyderabad, and Delhi-NCR.Saurabh Garg, Co-founder and CBO, NoBroker.com said, "Indian real estate in 2022, has been an exciting space to watch. Buoyed by favourable tailwinds, the sector overcame the inertia of the past several years' inertia to achieve record growth."

Garg further said that 2022 saw record-high capital appreciation and rent inflation. "The momentum is expected to continue well into 2023 as ready-to-move-in residential units, rental properties in gated societies, and plotted developments are very much in demand," he added.

According to the report, migrant professionals returning to work from offices in the key cities resulted in high demand for rental properties.

Due to Covid-19, construction activity had come to a halt resulting in less supply of housing units. This resulted in major cities registering rent inflation between 12– 40 per cent. However, the rents are expected to stabilise in a couple of months as construction activity and new project launches have caught up with the current demand. This also means the home buying outlook for 2023 remains positive as 77 per cent of respondents indicated that they are looking to buy a house next year, the report mentioned.

The consumer demand in 2022 also demonstrated robustness despite changes in market conditions. While initially driven by factors such as historically low home loan interest rates and developer discounts, it remained strong even when home loan interest rates and house prices increased in the latter part of the year.

In fact, the demand for ready-to-move-in properties far outstripped the supply, driving major buyer interest toward new project launches.