According to a research released on Thursday, the average price of a property in the top eight cities in India climbed by 10% during the January–March quarter as compared to the same period the previous year.
"The strong demand for homes that we're seeing nationwide, particularly for premium and luxury properties, is directly responsible for the increase in home prices," stated Boman Irani, president of CREDAI National. "CREDAI – Colliers – Liases Foras Housing Price- TrackerReportQ1 2024" was the report to which he was alluding.
"These have a direct bearing on the development of different micro-markets that have benefited greatly from large-scale infrastructure initiatives, which have changed the dynamics of supply and demand in residential real estate, in addition to a stable financing ecosystem. We don't think this trend will slow down in FY24 or FY25 either."
Bengaluru saw the biggest price increase, up 19% to Rs 10,377 per square foot from Rs 8,748 in the same quarter the previous year. The micromarkets in the city's Periphery and Outer East had the biggest increase, rising 32%. The Periphery and Outer North, with average home price increases of 18% annually, came next.
Following suit, the Delhi-National Capital Region saw a 16% increase in price to Rs 9,757 per square foot, up from Rs 8,432 per square foot the previous year. The Dwarka Expressway in Delhi saw the largest rise, at 23%.
Following suit, Ahmedabad and Pune saw increases of 13% and 14%, respectively, to Rs 7,176 and Rs 9,448 per square foot. These increases are driven by factors such as key launches, planned infrastructure projects, and luxury demand. According to Pankaj Kapoor, General Director of real estate data and analytics firm Liases Foras, "The real estate sector is expected to maintain demand due to affordability with moderate inflation and interest rates."
The unsold inventory increased by 3% in the top eight cities, indicating a decrease in the supply of dwellings relative to the demand. Nearly one million units of unsold inventory were held in the top eight cities as of Q1 2024, with the Mumbai Metropolitan Region accounting for nearly 40% of this total.
"Developers are likely to keep a close watch on available stock and anticipated demand while timing their new launches in the near term," the survey stated. Home prices will probably rise despite an increase in inventory since lower loan rates are anticipated later this year.
According to Badal Yagnik, CEO of real estate firm Colliers India, "Affordability can improve in the near term, especially for the EMI-dependent home buyers, with prospects of a reduction in benchmark lending rates in the ongoing financial year." "The prices could increase by 10-15 per cent, bridging the gap between affordability and inflation-adjusted prices," stated Kapoor.
