Housing prices across the top eight cities in India increased by 7%: Report
- IBEF
- August 10, 2023
In India's top eight cities, housing prices rose 7% year-over-year due to strong housing demand supported by persistent purchaser demand and steady borrowing rates.
According to a joint analysis by the Confederation of Real Estate Developers Associations of India (CREDAI), Colliers, and Liases Foras, Kolkata experienced the highest residential price growth at 15% year-over-year, followed by Delhi NCR, and Hyderabad with 14% and 13% y-o-y growth, respectively.
According to the President of the Confederation of Real Estate Developers Associations of India (CREDAI), Mr. Boman Irani, the steady increase in sales volume across the nation is a glaring indicator of homebuyers' optimistic attitudes and confirms the favourable market conditions. Due to the pent-up demand from Covid, we are also seeing record-breaking sales, and despite the price increase, this trend is anticipated to continue for the remainder of the fiscal year, thanks to a mostly stabilised repo rate and financing eco-system. The forthcoming holiday season will also contribute to raising sales and maintaining momentum into the beginning of 2024.
The top markets have also seen heightened activity in new launches in the past few quarters. This has led to an increase in unsold inventory by 13% y-o-y across India, with Delhi being the only market witnessing a drop.
All around the nation, house prices have been steadily rising during the previous ten quarters. Due to increased transparency surrounding monthly EMIs, homebuyers' sentiments have remained optimistic despite the repo rate stabilising at 6.5% since February 2023. Housing demand is still strong, despite the difficulties developers are still having with rising construction prices. The forthcoming holiday season and sustained preference for home ownership are expected to be the driving factors behind an increase in housing demand over the next few quarters, says Managing Director, Occupier Services, Colliers India, Mr. Peush Jain.
Housing costs for under-construction units have also risen in cities like Kolkata, Hyderabad, Delhi NCR, and Bengaluru because of rising demand for large homes and a surge in high-end projects. In Q2, major cities saw price increases for three- and four-bedroom homes ranging from 2% to 20%.
According to Managing Director of Liases Foras, Mr. Pankaj Kapoor, many new launches over the past year, and momentum is continuing, have helped the housing market maintain its caution and restraint. Supply growth has kept price increases manageable and profitable, attracting both end users and long-term investors. Sales will probably keep increasing as long as costs and affordability remain stable.
A bullish trend in the Indian housing market is anticipated to continue, supported by low mortgage rates, and rising disposable incomes. 81,883 units were sold in total during the second quarter, an increase of 6% year over year. In the second quarter of 2023, new releases made up roughly 15% of overall sales, driven by elements like pertinent products in the ideal segment at the ideal price in an ideal location.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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