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Overall housing prices across the top eight cities Ahmedabad, Bengaluru, Chennai, Delhi NCR, Hyderabad, Kolkata, MMR, and Pune have surged 7 per cent year-on-year during the second quarter of 2023, according to CREDAI – Colliers – Liases Foras Housing Price-Tracker Report.
The increase in housing prices comes on the back of positive home buyer sentiment and stable interest rates, along with growth in net spendable income.
Kolkata recorded a 15% increase y-o-y in residential prices, which is the highest among the top eight cities. Kolkata is followed by Delhi NCR and Hyderabad with 14 per cent and 13 per cent increase y-o-y respectively, the report said.
According to CREDAI National President, Boman Irani, the stable growth in sales volume across the country strongly indicates the optimistic attitudes of homebuyers, while validating the favorable conditions in the market. “On the back of a reasonably stable repo rate and lending ecosystem, we are also seeing record-breaking figures as a result of the pent-up demand from covid. Despite the price increase, we anticipate this trend to continue for the remainder of the fiscal year. Additionally, the forthcoming holiday season will contribute to growing sales even more and maintaining momentum into 2024,” he added.
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The unsold inventory surged by 13 per cent year-on-year across India. However, Delhi NCR witnessed a drop in unsold inventory levels at 7 per cent year-on-year, pointing at consistent revival in market fundamentals.
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Peush Jain, Managing Director, Occupier Services, Colliers India said that the a consistent upward trend has been observed in the housing prices across the country in the last 10 quarters, adding, “With repo rate stabilising since February 2023 at 6.5 per cent, homebuyers’ sentiments remain positive due to greater visibility on monthly EMIs.” He further shared that the demand in the housing sector remains unwavered, despite the developers continuing to grapple with the challenges posed by higher costs of construction. He also predicted a further acceleration in the housing demand over the next few quarters backed by the upcoming festive season and continued preference for home ownership.
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“While most cities saw double-digit price increases during Q2 2023, Delhi NCR is consistently seeing an uptick in housing prices for the past 12 quarters. Notably, the newly developed Dwarka Expressway and the upcoming 50 km 6-lane highway in Delhi NCR are expected to further drive demand in Gurugram, Ghaziabad and Noida. Amidst other major cities, prominent micro-markets in MMR saw a price rise of 3-5 per cent YoY,” said Vimal Nadar, Senior Director and Head of Research, Colliers India.
Kolkata’s housing price rose 15% y-o-y
In the second quarter of 2023, overall housing prices in Kolkata witnessed a 15 per cent surge y-o-y growth. Housing prices in Kolkata have been on the rise over the past 7 quarters, the report highlighted. The current rise in home prices is a result of increased demand brought on by favorable government incentives like the prolongation of the 2% stamp tax reduction and the 10% circle rate discount through September 2023.
Unsold inventory falls by 7 per cent year-on-year in Delhi NCR
The unsold inventory in Delhi NCR plummeted 7 per cent y-o-y. This made Delhi NCR the only city across India to witness a fall, indicating continued healthy market dynamics. The last two quarters have seen a decline in Delhi NCR’s unsold inventory, indicating a favorable outlook for consumer spending.
Housing prices in Hyderabad and Ahmedabad have consistently shown a rise over the past few quarters despite an increase in unsold inventory, the report added.
Pankaj Kapoor, Managing Director, Liases Foras, “The housing market has maintained its prudence and discipline primarily due to a high number of new launches over the last year, and momentum is continuous. Increasing supply has kept the price rise moderate and productive, drawing both the end user and long-term investors. Sales will likely continue to grow since the affordability and prices maintain parity.”
