Higher demand pushed residential prices up 6% in April-June quarter: Report

During the April-June period, housing sales across the eight major cities experienced an 8% increase to 80,250 units

The prices of homes in India jumped six per cent to Rs 7,000-7,200 per square foot in the April-June quarter this year, as compared to last year, a report released on Tuesday said. The price rise would have been higher but the new supply has kept it to a moderate level.

According to "Real Insight Residential - April-June 2023" released by PropTiger.com, the highest jump in residential prices was seen in Gurgaon. The prices in the city jumped 12 per cent year-on-year (YoY) to Rs 7,000 to Rs 7,200 per square foot during the quarter.

During the April-June period, housing sales across the eight major cities experienced an eight per cent increase to 80,250 units, PropTiger said.

"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," said Vikas Wadhawan, business head at PropTiger.com.

Ankita Sood, head of research at PropTiger's parent REA India said, "We are witnessing a surge in demand from businesses and large companies in Gurgaon. The city continues to dominate in terms of Grade A commercial development, solidifying its position as a top choice for business. As a ripple effect, the Gurugram property market has seen good traction for both luxury and mid-segment housing."

In price rise, Gurgaon was followed by Bengaluru and Noida.

The home prices in Bengaluru rose nine per cent YoY to Rs 6,300 to Rs 6,500 per square foot. In Noida, the prices jumped eight per cent to Rs 5,600 to Rs 5,800 per square foot.

According to Sood, the surge in housing demand in Delhi-NCR is driven by consumers seeking improved amenities and an enhanced lifestyle, migrating from conventional property format.

Despite a price rise, however, the housing demand continues to remain robust.

"Despite both an appreciation in prices and a rise in mortgage rates, housing demand has remained strong. Going forward, with interest rates on home loans likely to remain stable or even 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," Wadhawan added.