Delhi-NCR outpaced Mumbai in 2022 real estate market, says report

National capital region of Delhi (Delhi-NCR), the country’s second largest real estate market after the Mumbai Metro Region (MMR), bounced back to outpace all key markets, including MMR, in 2022. After its lacklustre performance in 2022, following the second COVID-19 wave that severely disrupted activities, the NCR market has emerged as the most preferred destination of private equity (PE) investors.

As per latest data from Anarock Capital Market Research, Delhi-NCR attracted the largest chunk of PE investments during the April-December period. While the region, comprising cities like Delhi, Gurgaon, Noida, Greater Noida, Ghaziabad and Faridabad, received PE investments worth US$ 1,215 million (or US$ 1.215 billion) or over Rs 9,700 crore during the period. The largest real estate market MMR received only US$ 224 million or Rs 1,800 crore. Incidentally, investments in Delhi-NCR grew by a whopping 58 per cent year-on-year, compared to a 61 per cent drop in MMR. The sharp drop in investments resulted in MMR slipping to the third spot behind Chennai that received US$ 268 million or Rs 2,150 crore during the period.

According to analysts at Anarock, in 2022 the Covid-19 pandemic failed to become a deterrent for the NCR real estate market, “which remained vibrant and performed remarkably well. The region witnessed more interest from private equity players than its counterpart realty hotspot MMR,” they noted.

While in the residential real estate market, the NCR market’s superior performance reflected in sales and launch numbers. As per Knight Frank Research, while Delhi-NCR (58,460 units) remained at the second spot behind MMR (85,169 units), sales grew fastest in NCR (by 67 per cent y-o-y) compared to any other market. In MMR market, sales grew by 35 per cent y-o-y, Bangalore registered a 40 per cent rise in sales of residential homes during 2022.

In terms of new launches, the NCR market whizz passed every other market with its astounding 207 per cent rise in the number of new units launched, compared to 64 per cent jump in Kolkata and 42 per cent in Bangalore, followed by 29 per cent in MMR.

“The NCR market has seen a substantial momentum in residential sales in the last couple of years, with 2022 recording the best sales numbers since 2014. Most of the demand was for completed or nearly completed projects despite comparatively higher price against recently launched project. The growth is based on consumer confidence, demand for larger and better homes as well as still affordable prices led the demand, even while prices have risen by an average of 7% and home loans becoming dearer,” said Mudassir Zaidi, Executive Director – North at Knight Frank India.

According to him, the extent of office spaces transacted in NCR made it one of the best performing office markets in 2022. The region witnessed strong rebound in office space leasing and preference for NCR’s well-developed business districts as a hotspot for corporate occupiers.

 
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