Housing prices surge 7% across top eight metros; Kolkata the unlikely topper

• In Q2 2023, Kolkata saw the highest housing price surge annually among the top eight Indian cities at 15%.
• The upcoming festive season will help in further boosting the sales and sustain the momentum through the start of 2024.
• Delhi NCR's unsold inventory decreased by 7% when compared to the same period in the last fiscal.

Residential property rates in the leading eight urban centres of India surged by 7% year-on-year (Y-o-Y) driven by strong demand for housing supported by ongoing favourable attitudes among homebuyers and consistent interest rates, according to a report by Colliers, CREDAI and Liases Foras. The report also revealed that the city of joy, Kolkata, saw the biggest spike in the compared period.

With a consistent aspiration for owning homes and stable interest rates, along with an increase in disposable incomes, the demand for housing is set to steadily expand, even in the face of global economic challenges.

Given the rising desire for larger living spaces, developers persist in launching upscale projects, resulting in an upward trend in housing prices for properties still under construction in cities like Kolkata, Hyderabad, Delhi NCR, and Bengaluru.

Says Boman Irani, President of CREDAI National , “We’re witnessing record breaking numbers due to the pent-up demand from covid and despite the price rise, we expect this trend to continue for the rest of the fiscal year – on the back of a relatively stabilised repo rate and lending ecosystem. Additionally, the upcoming festive season will help in further boosting the sales and sustain the momentum through the start of 2024.”

City	Average Price Q2 2023(₹/sq ft)	QoQ Change		Y-o-Y Change
Ahmedabad	6,507		3%	10%
Bengaluru	8,688		-1%	10%
Chennai	7,653		3%	6%
Delhi NCR	8,652		3%	14%
Hyderabad	10,530		1%	13%
Kolkata	7,315		1%	15%
MMR	19,111		-1%	-3%
Pune	8,540		2%	11%

Source: Liases Foras, Colliers

All the prices are based on carpet area

Kolkata sees the highest price rise

In Q2 2023, Kolkata saw the highest housing price surge among the top eight Indian cities at 15% when compared to the same period last financial year, continuing a seven-quarter upward trend. This rise is due to increased demand, driven by government incentives like a 2% stamp duty reduction and a 10% lower circle rate extension until September 2023.

In the same quarter, Delhi NCR followed closely with a 14% Y-o-Y increase. Notably, Golf Course Road and Dwarka Expressway witnessed remarkable price rises at 46% and 40% respectively. Golf Course Road's prices outpacing Delhi's in Q2 2023 can be attributed to improved connectivity and proximity to Gurugram's commercial hubs, spurring higher demand for homes.

Delhi NCR the only city where unsold inventory drops

Delhi NCR's unsold inventory decreased by 7% Y-o-Y, making it the sole city across India to experience such a decline, showcasing sustained healthy market dynamics. This trend of decreasing unsold inventory has continued for the last two quarters in Delhi NCR, indicating positive consumer buying sentiment.

Conversely, driven by a surge in new project launches, especially in the Northwest suburb of Ahmedabad and the Southwest micro market in Hyderabad, both cities saw a rise in unsold inventory by 26% and 24% respectively Y-o-Y. Despite this increase, housing prices in both cities have consistently shown an upward trajectory over the past few quarters.