Mumbai, Sep 2 (IANS): The full year residential sales for the current financial year is likely to surpass 700 mn sq. ft on a conservative basis after the first quarter showed sales rise, according to the Kotak Institutional Equities report.

All-India residential real estate sales across major cities in India increased 86 per cent on-year to 186 mn sq. ft in the first quarter of current financial year, as compared fo 101 mn sq. ft sale in same period last year that was impacted by the second wave of COVID-19, with all regions firing up in a secular way.

"We note that 1QFY23 with sales of 186 mn sq. ft registered as the fourth consecutive quarter of sales above 150 mn sq. ft, signalling strong underlying demand," report said.

Among the key cities, sales momentum was the strongest in Bangalore, followed by Mumbai Metropolitan Region, and Gurugram.

Sales continued to outpace launches with outstanding inventory across the country reducing to 1.21 bn sq. ft as of June 2022 and equivalent to

A combination of improving sales for the real estate sector at large, market share gains for organised developers and rising real estate prices augur well for listed real estate developers.

Street concerns on impact on demand in an environment of rising interest rates, as well as margin contraction due to rising input costs may not play out owing to continued market share gains and rising real estate prices amid a buoyant demand scenario.

Region-wise performance in 1QFY23:

National Capital Region: Sales activity remained robust in National Capital Region in 1QFY23 at 12.7 mn sq. ft, despite muted weak launch activity during the quarter. Sales-mix was dominated by Gurugram (31 per cent), followed closely by Greater Noida (30 per cent), with Noida and Ghaziabad contributing 16 per cent each to sales in 1QFY23.

Mumbai Metropolitan Region (MMR): MMR continued to witness strong momentum in residential launches in 1QFY23, with 37 mn sq. ft of new launches during the quarter led by launches in Mumbai and Navi Mumbai. Sales for the quarter stood at 36 mn sq. ft. with 17.5 mn sq. ft of sales in Thane and another 13 mn sq. ft of sales in Mumbai.

Bengaluru: Bengaluru saw sales of 20 mn sq. ft (+110 per cent yoy, -4 per cent qoq) led by launches of 12 mn sq. ft (+3.1X yoy, -31 per cent qoq) in 1QFY23.

Hyderabad: Hyderabad saw sales of 27 mn sq. ft (+73 per cent yoy) aided by launches of 25 mn sq. ft (-8 per cent yoy) in 1QFY23. Outstanding inventory reduced modestly to 148 mn sq. ft during the quarter (150 mn sq. ft as of FY2022) and is equivalent.