Kolkata Apartment Registrations Soar 69 Percent YoY in April 2024: Knight Frank India Report

Kolkata's property registration market witnessed a significant upswing in April 2024, registering the highest number of apartment registrations for any April month in the past five years. This positive trend comes amidst ongoing government incentives and a shift in buyer preferences. According to a report by Knight Frank India, a total of 3,839 apartments were registered in the Kolkata Metropolitan Region during April 2024. This represents a robust 69 percent growth year-on-year and surpasses the previous best performance for April registrations. Even compared to March 2024, the market saw a minor correction of only two percent, indicating sustained momentum. This impressive growth suggests that the city’s real estate market is thriving, buoyed by favorable conditions and increased buyer activity.

Government Incentives Drive Demand

Experts attribute this upsurge in registrations partly to the state government's continued extension of stamp duty reduction. Since July 2021, the phased rollout of stamp duty remission has positively impacted buyer sentiment, making property purchases more attractive. This incentive has demonstrably benefited the real estate sector in Kolkata, encouraging more individuals to invest in property and boosting overall market activity. The government's proactive measures in reducing the financial burden on buyers have created a conducive environment for real estate growth.

Shift in Buyer Preferences

The report also unveils a fascinating trend in apartment size preferences. While the share of registrations for units below 500 sq ft witnessed a slight decline from 46 percent in April 2023 to 43 percent in April 2024, apartments ranging from 501 sq ft to 1,000 sq ft saw a significant rise in popularity. This segment now constitutes a dominant 50 percent share of total registrations, up from 38 percent the previous year. Conversely, registrations for luxury apartments exceeding 1,000 sq ft dropped dramatically, falling from 16 percent to a mere seven percent during the same period. This shift indicates a growing preference for mid-sized apartments, likely driven by changing lifestyle needs and economic considerations.

South Zone Leads Micro-Market Activity

The report further delves into micro-market trends. April 2024 saw the South Zone emerge as the leader in property registrations, capturing a 36 percent share of Kolkata's total. This is a significant rise from its 19 percent share in April 2023. The North Zone, though experiencing a shift from its top position last year (42 percent share), still holds a strong second place with 35 per cent of registrations in April 2024. These zones, historically known for offering affordable housing options, continue to be at the forefront of Kolkata's property market activity. The West Zone also witnessed a positive rise in its share, increasing from eight percent to 15 percent year-on-year. These trends highlight the dynamic nature of Kolkata's real estate market, with different areas experiencing varying degrees of growth and activity.

Challenges and Opportunities for Kolkata Real Estate

While the overall registration numbers paint a promising picture, there are areas for improvement. Experts point out that the significant decline in registrations for larger luxury apartments indicates a potential lack of buyer confidence in the higher-price segment. This suggests a need for stronger efforts to attract talent and boost economic activity in sectors like IT/ITeS and financial services. By building a more robust profile and fostering a thriving economy, Kolkata can create a more holistic environment for its real estate market to flourish.

The city’s real estate sector faces the dual challenge of sustaining growth in affordable and mid-sized housing while reviving interest in luxury segments. Strategic initiatives, such as enhancing infrastructure, improving connectivity, and creating more job opportunities, could help in addressing these challenges. Additionally, developers and policymakers need to work closely to create a balanced and inclusive real estate market that caters to diverse buyer preferences and economic backgrounds.

Southern India Poised To Lead Recovery In Office Market

The commercial real estate sector in India is expected to witness a significant revival, with Southern India positioned at the forefront of this resurgence. A report by JLL, a leading real estate services firm, highlights this trend, pinpointing Bengaluru, Hyderabad, and Chennai as key players in the recovery. Robust tech sector demand in these cities is likely to drive commercial real estate activity, contributing to overall market growth. This regional trend underscores the interconnected nature of India's real estate market, where developments in one region can influence trends and opportunities in others.

Conclusion

Kolkata’s real estate market is on an upward trajectory, with a significant surge in apartment registrations reflecting strong buyer sentiment and effective government policies. The shift towards mid-sized apartments and the dominance of the South and North Zones highlight changing preferences and market dynamics. However, the decline in luxury apartment registrations presents both a challenge and an opportunity for developers and policymakers. By addressing these challenges and leveraging the opportunities, Kolkata can continue to build on its current momentum, ensuring sustained growth and a vibrant real estate market in the coming years.