Kolkata has the largest YoY rise in residential costs, at 15%, followed by Delhi-NCR and Hyderabad, which had increases of 14% and 13%, respectively.
According to a joint analysis by CREDAI, Colliers, and Liases Foras, property prices in India’s top eight cities climbed 7% year on year due to sustained housing demand supported by ongoing favorable homebuyer sentiment and stable borrowing rates.
“Driven by a sustained aspiration for home ownership and stable interest rates, combined with growth in disposable incomes, housing sector is set to experience consistent expansion even in the face of unprecedented global economic challenges,” the report stated.
“The ongoing momentum in volume residential sales across the country is an unambiguous indication of favorable consumer sentiment and confirms the friendly nature of the market,” said Boman Irani, president of CREDAI-National. We are also seeing record-breaking numbers as a result of COVID-19 pent-up demand, and despite the price increase, we’re anticipating this upward trajectory to persist for the remainder of the financial year — owing to a reasonably stable repo rate and financing climate.”
He went on to say that the forthcoming festive period is expected to raise purchases even more and keep the trend going until the commencement of 2024.
According to the survey, leading markets have experienced an upsurge in new launches in recent quarters, in parallel with sales. As a result, unsold inventory in India increased by 13% year on year. Unsold inventory levels in Delhi-NCR fell by 7% year on year, indicating a continuing improvement in market fundamentals.
Developers continue to introduce high-end projects in response to rising demand for expansive residences, pushing housing costs for under-construction units northward in areas like as Kolkata, Hyderabad, Delhi-NCR, and Bengaluru.
“Over the last ten quarters, there has been an ongoing upsurge in housing prices across the nation,” said Peush Jain, managing director (occupier services) of Colliers India. With the repo rate stable at 6.5 percent since February 2023, homebuyers’ emotions remain favorable due to better clarity on monthly EMIs.”
“Factors such as better infrastructure, greater connectivity, rising disposable income, and incentives from the government have fueled housing demand across Indian cities,” said Vimal Nadar, senior director and head (research) at Colliers India. While other cities had double-digit price rises in Q2 2023, the Delhi NCR has seen an increase in housing prices for the preceding 12 quarters.”
He further stated that the recently constructed Dwarka Expressway and the forthcoming 50 km six-lane highway in Delhi-NCR are projected to boost demand in Gurugram, Ghaziabad, and Noida. Among other large cities, renowned micro-markets in MMR reported price increases of 3-5% year on year.
Overall property prices in Kolkata increased by 15% year on year in Q2 2023, the most among India’s top eight cities. Over the last seven quarters, the city’s housing prices have risen. The current increase in property prices is due to increased demand, which has been encouraged by favorable government incentives such as the prolongation of a 2% reduction in stamp duty and a 10% reduction in circle rates until September.
During the second quarter of 2023, home prices in Delhi-NCR increased by 14% year on year. At the micro-market level, Golf Course Road and Dwarka Motorway had the greatest YoY increase in house prices, at 46% and 40%, respectively.
Golf Course Road housing prices keep outperforming Delhi pricing in Q2 2023, owing to improved connectivity and closeness to commercial office centres in Gurugram, which have prompted a rise in demand for residential homes.
“The housing market has maintained its caution and discipline primarily due to a high number of new launches over the last year, and momentum is continuous,” said Pankaj Kapoor, managing director of Liases Foras. Rising supply has kept price increases low and productive, attracting both end users and long-term investors. Sales are anticipated to increase as long as affordability and prices remain stable.”