Real estate developers in India are using strong housing demand to clear existing inventories, reducing the stock of unsold properties that had been a concern in previous years. A healthier balance between demand and supply has also contributed to greater market stability.

Residential property markets across the country’s top seven cities have seen a 31% reduction in the time required to sell active unsold housing inventory, according to a recent analysis. In the March quarter, the time needed to liquidate inventory dropped to 22 months, down from 32 months at the end of 2019, mainly due to a sharp rise in housing demand. This estimate is based on average sales seen over the past eight quarters.

In the affordable housing segment, the decline was driven by its shrinking share in new project launches over the past four years. In contrast, the premium segment saw a reduction even as its share of annual launches rose significantly — from 2% in 2019 to 22% in 2023. The time taken to sell unsold premium units has fallen from 51 months in 2019 to 29 months in the first quarter of 2024, reflecting strong sales momentum.

Higher-end apartments now take an average of 29 months to sell as of March-end. Despite the longer duration compared to other segments, this marks a big improvement due to faster sales velocity. The premium category has emerged as the top performer, driven by strong buyer interest in larger homes with better amenities.

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