Hyderabad leads spike in luxury home prices – top 7 cities see 24% price rise in five years

• In 2018, luxury home prices in the top seven cities averaged around ₹12,400 per square foot, which has now escalated to approximately ₹15,350 per square foot.
• Bengaluru and Mumbai Metropolitan Region (MMR) followed Hyderabad closely with a 27% average price increase each.
• Affordable homes priced below ₹40 lakh experienced a more modest 15% price appreciation during the same period.

The luxury homes segment, which pre-pandemic was in a lacklustre state, received a remarkable boost during the lockdown period resulting in substantial growth in sales and thus new supply being added. With demand surging, it was only a matter of time before prices caught up.

An analysis of average price trends across the top seven cities in different budget categories, based on ANAROCK Research data, reveals that luxury homes have seen the most significant price appreciation at 24% over the past five years.

In 2018, luxury home prices in these cities (Delhi-National Capital Region (NCR), Mumbai Metropolitan Region, Chennai, Kolkata, Bengaluru, Hyderabad and Pune) averaged around ₹12,400 per square foot, which has now escalated to approximately ₹15,350 per square foot.

Hyderabad sees significant rise, followed by Bengaluru

Among the top seven cities, Hyderabad witnessed the most substantial leap of 42% in the average price of luxury homes during this period, rising from around ₹7,450 per square foot in 2018 to about ₹10,580 per square foot in the first half of 2023. Bengaluru and Mumbai Metropolitan Region (MMR) followed closely with a 27% average price increase each.

In Bengaluru, the average price of luxury homes was ₹10,210 per square foot in 2018, which has now risen to ₹12,970 per square foot. In MMR, homes in the ₹1.5 crore category had an average price of ₹23,119 per square foot in 2018, which has now reached ₹29,260 per square foot.

Affordable homes experience a more muted rise

Contrastingly, the affordable segment - which was on a high before Covid-19 - saw compromised sales that also reflected in its average price growth.

Affordable homes priced below ₹40 lakh experienced a more modest 15% price appreciation during the same period. The average price in this category across the top 7 cities was ₹3,750 per square foot in 2018, and it now stands at ₹4,310 per square foot.

NCR witnessed the most significant average price increase in this category at 19%, going from ₹3,120 per square foot in 2018 to ₹3,700 per square foot in H1 2023. Hyderabad's budget homes came in second with a 16% price appreciation, rising from ₹3,460 per square foot in 2018 to ₹4,000 per square foot in H1 2023.

Anuj Puri, Chairman - ANAROCK Group, says, "Extremely robust sales ably supported by good supply pipeline have resulted in luxury homes witnessing the most significant price appreciation. Considering the relative price stagnation in this segment in earlier years, a 24% increase over the last five years is notable. In the pre-pandemic period in 2019, sales in this segment were anything but stellar and this reflected in non-existent or negligible price growth."

Avg. Price Appreciation in Top 7 Cities (₹/sq.ft.) - 2018 Vs 2023
Year	Affordable (<₹40 Lakh)	Mid & Premium (₹40 lakh - ₹1.5 Cr)	Luxury (> ₹1.5 Cr)
2018	3,750	6,050	12,400
2023	4,310	7,120	15,350