According to a recent report, the housing price growth in India has surged significantly during the first quarter of 2023 with average price rise across all the major realty markets being close to 7% YoY. The report indicates that all the markets covered in the analysis showed an upward movement in average rates of new properties. The sharp uptick in property prices was primarily due to the hike in prices of building materials.
The report indicates that the average rate of properties in Bengaluru underwent a 10% appreciation in the past one year, making it the market with the sharpest uptick in property prices. Pune and Ahmedabad trailed behind this southern market closely in terms of price increase, with both markets witnessing an 8% and 7% rise in their average property rates, respectively.
Mr. Vikas Wadhawan, Group CFO, PropTiger.com, Housing.com & Makaan.com, said,” Real estate has consistently been the best asset class over the long term, and with prices only expected to go up, it’s an excellent time for fence-sitters to take the jump and buy their dream home. Despite the potential for increased prices, it’s important for homebuyers to consider market trends and make informed investment decisions.”
The report highlights that the cost of owning a house in India continues to rise due to several factors, including the continuous rise in the cost of raw materials and labor, the growing demand for ready-to-move-in properties, and the cessation of government-funded subsidy schemes in March this year. Furthermore, while the Reserve Bank of India has paused the rate hike for now, inflation remains a concern, and the central bank may increase the benchmark lending rate in the next cycle, which could further amplify the rise in property prices. As a result, prospective homebuyers need to monitor market trends and factor in the possibility of increased prices before making any investment decisions.
Discussing the buying trends in the city, Ms. Ankita Sood, Head of Research, Housing.com, said: “Property prices in Indian cities have been growing at the fastest pace of 6-7% since the past year with a renewed thrust on homeownership.
Apart from rise in input cost, the limited supply of the right product and ready to move in projects for the predominant end-user have led to the upward push on prices.
Interestingly, while the weighted average prices have grown by 6 per cent YoY, in the March quarter, key micro-markets in cities of Gurugram, followed by Bengaluru have seen YoY growth of 13 per cent and 10 per cent, respectively.
Given the current market trends of demand supply mismatch, we expect property prices to continue to rise albeit in close ranges, where quality ready-to-move in segment will trade at a premium.”
The report also highlighted the current average price of properties in major Indian cities as of March 2023. The weighted average prices as per new supply and inventory indicate that the average prices per square foot in cities such as Ahmedabad, Bengaluru, Delhi NCR, Kolkata and Pune have witnessed a significant increase.
Source: Real Insight Residential – January-March 2023
Note: Weighted average prices as per new supply and inventory as of March 2023
Renuka Kulkarni, a seasoned real estate professional, brings over five years of diverse experience in research, consulting, and architectural design within the urban sector. Her expertise spans public and private projects, showcasing proficiency in real estate research, trend interpretation, and policy analysis. With qualifications in architecture and a master’s degree in Data Science (Business Intelligence & Data Analytics) from IIIT Bengaluru, along with an M. Tech in Urban Development and Management from TERI School of Advanced Studies, New Delhi, Renuka seamlessly blends data analytics with market insights, offering a holistic understanding of the industry in her research pieces.
Related Posts
2022 ends on a high for India’s property market – demand up by 50% YoY in top cities.
Residential new supply up by 86% in March quarter; demand grows at a slower pace of 22%.
Average price of new residential units declines 14% in 2016: Cushman & Wakefield.
9.6 million sq ft Grade A office space absorbed in Q3: Colliers report.
Realistic pricing key to market revival in 2017: Colliers International’s India Property Outlook.
Residential sales up by 13%, launches by 19% in Q4 FY17: PropTiger’s Realty Decoded report.
