Housing prices in 10 cities fall while 12 observe hike in Q2:2013
While residential properties in 12 cities in India have witnessed a hike by upto 5.3 percent, around 10 cities including Delhi, have dropped by up to 7 percent, in the July-September 2013 quarter. Even during a slow moving economy, investors seem to be confident enough to invest in the sector.
The national capital Delhi, on annual basis, has witnessed 6.7 percent rise in property prices. But it has dropped by 4.53 percent during the recent quarter ended September, according to Residex released by National Housing Bank (NHB).
Price corrections
As per the Residex, Meerut witnessed the maximum price moderation of 6.88 percent while the highest price appreciation of 5.3 percent was recorded by Kolkata. With merely 0.46 percent appreciation, Mumbai stood the last in the list of cities that witnessed price-hike.
Residential property prices in Chennai increased by 4.95 percent, followed by Hyderabad with 4.77 percent rise, Ahmedabad 2.69 percent, Lucknow 2.14 percent and Patna 2.04 percent.
Some cities recorded a moderate change in property rates which include- Ludhiana 4.46 percent, Vijayawada 4.03 percent, Nagpur 3.58 percent, Bhopal 3.09 percent, Indore 2.18 percent, Jaipur 1.82 percent, Bhubaneshwar 1.03 percent and Bengaluru 0.93 percent.
The NHB Residex currently covers 26 cities in total, with base year as 2007. The property prices remained unchanged in the remaining four cities including Pune, Kochi, Coimbatore and Dehradun.
Not a good time to invest?
The numbers discussed above are procured only after a comparison of the residential property prices of the 26 cities during Q2 of 2013 with the values derived in the previous quarter (Q1 of 2013 or Apr-Jun 2013 period). For a long term investment like real estate, judging by the quarterly values would not be much appropriate.
One has to note that the house prices in the leading cities of India such as Mumbai, Delhi, etc. still continue to increase higher and higher over the years and are unaltered by the sluggish economy. Though the interest rates on loans by the central bank had been increased several times, the cities continue to exhibit a positive growth trend.
When will the sector revive?
However, it is difficult to anticipate towards where the sector is actually headed at and whether it would revive soon or will it take some more time. Some market analysts opine that until the upcoming elections are over, the prices may continue fluctuating. And once the political environment stables down, the prices will also get some stability.
