The housing sector in India has witnessed a notable surge of approximately 20 percent over the last two years, from 2021 to 2023, as revealed by the latest Housing Price-Tracker Report jointly issued by CREDAI, Colliers, and Liases Foras.
In prominent urban centers like Bengaluru, Delhi NCR, and Kolkata, this surge has been particularly pronounced, with housing prices witnessing a remarkable ascent of around 30 percent during the aforementioned period.
Mr. Boman Irani, President of CREDAI National, remarked, "The year-on-year increase in housing prices is a combination of several factors, characterized by strong, robust demand from homebuyers."
This surge underscores a substantial demand for residential properties, notably in the mid and luxury segments, propelled by favorable economic conditions and low-interest rates.
Despite a significant influx of new housing supply, the unsold inventory in key cities like Delhi NCR saw a notable reduction of 19 percent during the 2021-2023 period, indicative of a healthy absorption of available housing stock. Similar trends were observed in cities like Chennai and Pune, further underscoring the robust demand dynamics prevailing in the market.
The year 2023 witnessed a noteworthy 9 percent year-on-year increase in housing prices across India's top eight cities, signaling continued market momentum and sustained growth.
In terms of city-wise trends, Bengaluru emerged as the frontrunner with a 21 percent year-on-year increase, followed by Kolkata at 11 percent.
According to Badal Yagnik, Chief Executive Officer at Colliers India, "During the year, all the eight major cities witnessed an increase in housing prices, with Bengaluru leading at 21 percent YoY, followed by Kolkata at 11 percent."
Looking ahead to 2024, the market is anticipated to maintain its current trajectory, with the mid and luxury segments expected to flourish further, offering attractive opportunities for both investors and homebuyers.
Bengaluru, in particular, experienced heightened residential activity during the 2021-2023 period, witnessing a 31 percent increase in housing prices. Strong demand persisted in areas adjacent to IT hubs such as Whitefield, KR Puram, and Sarjapur, leading to a surge in new launches, especially in the luxury segment.
Meanwhile, the Mumbai Metropolitan Region (MMR), despite witnessing a modest 2 percent increase in housing prices in 2023 compared to 2021 levels, displayed notable recovery post-Covid-19.
Submarkets like Panvel, Western Suburbs, and Navi Mumbai observed price hikes, fueled by the completion of key infrastructure projects such as the Mumbai Trans Harbour Link and metro lines.
Industry experts project a positive outlook for 2024, fueled by the decrease in unsold inventory in cities like Delhi NCR, Chennai, and Pune, coupled with optimistic market sentiment and rising income levels.
Pankaj Kapoor, Managing Director at Liases Foras, commented, "The current state of real estate is the most productive when sales, supply, and prices are growing, and the price rise is not speculative. These factors work in harmony in a balanced and healthy real estate market."
The housing market in India remains vibrant, with balanced growth in sales, supply, and prices, indicating a robust and fruitful real estate landscape. As the market progresses into 2024, continued growth is expected, particularly in the mid and luxury segments, presenting attractive prospects for investors and homebuyers alike.
