Robust Demand and Limited Supply Propel Housing Prices Up by 6% in Major Indian Cities, Reveals PropTiger Report

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    The residential property market in major Indian cities has experienced a significant average year-on-year price appreciation of 6% during the April-June period, according to a recent report by PropTiger.com, an online real estate brokerage company. The surge in housing prices can be attributed to robust demand and limited supply in the market.
    The cities covered in the report include Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai Metropolitan Region, Delhi-National Capital Region, and Pune. The key highlights of the report, titled ‘Real Insight Residential – April-June 2023’ are as follows

    • The residential property market in major Indian cities experienced a 6% average year-on-year price appreciation during April-June 2023.
    • The weighted average price of residential properties across eight major Indian cities reached Rs 7,000 to 7,200 per square foot, marking a 6% increase compared to the previous year.
    • Housing sales in the same period recorded an 8% annual increase to 80,250 units across the eight cities.
    • Ahmedabad witnessed a 7% year-on-year increase in housing prices during Q2 2023, with rates ranging from Rs 3,700 to 3,900 per square foot.
    • Bengaluru saw a 9% price surge, averaging at Rs 6,300 to 6,500 per square foot.
    • Delhi-NCR observed a 6% growth, reaching Rs 4,800 to 5,000 per square foot.
    • Gurugram experienced a remarkable 12% appreciation, with prices reaching Rs 7,000 to 7,200 per square foot, while Noida witnessed an 8% rise, averaging at Rs 5,600 to 5,800 per square foot.
    • Mumbai and Pune, key property markets in Maharashtra, both saw a 3% increase in housing prices.
    • Mumbai’s weighted average price stood at Rs 10,100 to 10,300 per square foot, while Pune’s rates were at Rs 5,600 to 5,800 per square foot.

    Despite price appreciation and a rise in mortgage rates, housing demand remained strong. Stable or softened interest rates on home loans in the coming months are expected to further drive housing demand.
    Commenting on the findings, Vikas Wadhawan, Group CFO of REA India and Business Head at PropTiger.com, stated, “Housing prices have been climbing in major Indian cities in the post-COVID years. While this upward trend in capital values is attracting investors to India’s key real estate markets, the increase in new supply is helping to moderate price increases.”
    Ankita Sood, Head of Research at REA India, highlighted the surge in demand from businesses and large companies in Gurugram, emphasizing the city’s dominance in Grade A commercial development. She mentioned that this has resulted in increased traction in both luxury and mid-segment housing. Gurugram witnessed a year-on-year weighted average property price increase of 12% in Q2 2023, surpassing Bengaluru (9%) and Noida (8%).
    Sood added, “The limited supply has also contributed to the momentum in prices.”
    Wadhawan further stated, “Despite price appreciation and a rise in mortgage rates, housing demand has remained strong. Looking ahead, with interest rates on home loans likely to remain stable or soften in the coming months, we expect housing demand to rise. We strongly believe that the housing market is in the midst of a cyclical upturn.”

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