FCC

Housing market shows YoY increase of 3-9%

2022-07-07

Residential prices are increasing across all property markets in India, supported by a strong uptick in sales as homebuyers recognise their need for housing, interest rates are falling, and the economy is quickly recovering from the Covid19 pandemic waves. For the first time since the second half of 2015, housing prices have increased year over year during the first half of 2022 across all markets.

Housing prices rose by between 3% and 9% across the top 8 markets in the first half of the year, with some of the higher volume markets recording particularly notable increases. The period ended in June. According to data, the National Capital Region and Pune each saw a 7% price increase, while Mumbai and Bangalore saw an increase of 9% each.

With sales of 158,705 units, the first half of 2022 posted the highest sales volume since the second half of 2013 for any half yearly period. Sales registered an on-year growth of 60% in the first half of 2022.

Homebuyers' need to upgrade their primary lifestyle, low interest rates, and comparably low home prices to pre-pandemic levels, along with the renewed need for home ownership sparked by the pandemic, have been the main drivers for this growth. The robust volume of sales has also significantly increased real estate prices across all markets.

Developers launched 160,806 units in the first half of 2022, an increase of 56 percent, as a strategic response to the demand momentum and the change in sentiment. In terms of launches for any half-year period, this marks an 8-year high.

Due to increased demand, the office markets in Bangalore and Pune experienced the highest annual growth in rental value, at 13 percent and 8 percent, respectively. While rental values in Chennai, Ahmedabad, and Kolkata remained stable, they did moderately increase in Hyderabad, Mumbai, and NCR.