Delhi property prices shoot up 10%, other major cities witness 5% price hike

Residential property prices in the top eight cities of India including Delhi-NCR, MMR, Kolkata, Pune, Hyderabad, Chennai, Bengaluru and Ahmedabad have shot up by five per cent on a year on year (YoY) basis in the first half of 2022. Delhi-NCR has witnessed a price hike of 10 per cent, the largest in the country. Revised bank rates combined with an increase in input costs are reasons marked for the property price hike. However, demand during the period has been buoyant because of rising demand for housing among millennials in urban centres. 

Following Delhi, the next two cities which witnessed sharp price hikes over the same period were Ahmedabad and Hyderabad at 9 per cent and 8 per cent respectively. Some erosion in unsold inventory has been witnessed across the country – possibly led by demand for ready-to-move property. People have also made purchasing decisions on the basis of apprehensions around further bank rate hikes.  

Harsh Vardhan Patodia, President of CREDAI National said, “Housing prices have increased between 2–5 per cent across cities, as materials and labour costs continue to remain high. We may see a marginal dip in demand due to increasing interest rates, but sales will continue to grow across segments from September, as we enter the festive season. Rising homeownership amongst millennials supported by higher disposable income and willingness to upgrade to larger spaces equipped with better amenities has sparked a sharp growth in housing demand in the last few quarters.” 

Bengaluru residential property saw a significant dip in unsold inventory at 21 per cent but in a contrast, unsold inventory in Hyderabad, MMR, and Ahmedabad saw an increase. According to the reported data, MMR currently accounts for the highest share in unsold inventory at 36 per cent, followed by 14 per cent in Delhi-NCR and 13 per cent in Pune.  

“Price will remain range bound. With discounted EMI schemes, we see early signs of developers absorbing the impact of increasing interest rates. Sales volumes are likely to improve as we see growing new supply with festive offers, said Pankaj Kapoor, Managing Director, Liases Foras”.  

 

HIGHLIGHTS: 

10 per cent price surge in Delhi-NCR residential property  

Over the period of two years prices in Delhi-NCR have been rising. Delhi NCR saw the highest increase in prices across Pan India at 10 per cent with an average carpet price of Rs 7,434/sq feet in Q2 2022. Golf course road saw the highest price rise of 21 per cent YoY followed by Noida Expressway. The entire region’s inventory dropped 10 per cent YoY in Q2 2022, as developers focused on offloading older projects. While overall unsold inventory is the lowest in three years, the majority of the unsold inventory is concentrated in Noida Extension and Greater Noida, followed by Ghaziabad.  

14 per cent rise in MMR unsold inventory 

MMR, which accounts for the highest unsold inventory at 36 per cent share, saw a 14 per cent rise in unsold inventory in the last year. The rise in unsold inventory was led by significant new launches in the city. Housing prices largely remained range-bound, with a slight rise of 1 per cent YoY.  

21 per cent drop in Bengaluru unsold inventory

Bengaluru witnessed a sharp decline in its unsold inventory during Q2 2022, dropping by 21 per cent YoY. Inventory overhang in Bengaluru has been falling continuously since 2019 and is currently the lowest in last three years. The entire unsold inventory is mostly in Bengaluru’s peripheral areas.