Headache remains for buyers as property price rise continues

As per the records and survey through the last two and half years, Delhi and Mumbai have recorded property price appreciation of 33.3 per cent and 22.65 per cent respectively. In this list, Jaipur topped the list of price rising of property for about 64%. Real Estate properties prices are....

Date:- 2014-12-02 18:30:00

As per the records and survey through the last two and half years, Delhi and Mumbai have recorded property price appreciation of 33.3 per cent and 22.65 per cent respectively. In this list, Jaipur topped the list of price rising of property for about 64%. Real Estate properties prices are on the hike on 12 major cities of the country since 2011, the national Housing Bank (NHB) data show. Only three cities have recorded drop in real estate prices between 2011 and December 2013 they are Kochi, Bhopal and Faridabad (Green Field). According to NHB Residex, Kolkata city has recorded the least appreciation in Real Estate property prices for about 1.03 %. Inflation, Construction and land costs are the major reasons for the price appreciation as per the experts. They also include that this price hike would have been much higher had a slowdown will not hit the economy. NHB Chairman R V Verma says excluding the Delhi National Capital Region (NCR) and Mumbai; the market is functioning efficiently. “Demand is pulling up prices in most cities. Also, there is an inflationary cost attached to it. Credit is easily available in small cities — tier-I and tier-II. Housing loans are going up; there is growth of about 20 percent.“In the coming period, people expect interest rates and prices to rise, which is why this is the right time to buy property.” Samir Jasuja, founder and chief executive of real estate research company PropEquity, says, “Despite the slowdown, there are green shoots in many micro markets, which continue to give significantly high returns. Markets in various cities have seen price appreciation of 50-150 percent since 2008-09.” Delhi-NCR and Mumbai are the main cities of high prices in real estate. In these regions, investors hold on the properties that result into in end users not being able to buy would buy the property. An Analyst from real estate field says this will also result in barriers for the creation of property at lower prices in these areas. According to consulting firm Liases Foras, for the December 20123 quarter, Mumbai is the highest inventory of 46 months. And the inventory of 8 months shows a healthy real estate market. Shveta Jain, executive director (residential services), Cushman & Wakefield, says, “Though activity has come down, we are now seeing more healthy transactions. Speculative investments/activities have also slowed, which is a very good sign. The market is more mature now.” In the high- and mid-end segments, price appreciation across India stood at an average 22-23 percent through the past year, Jain said.

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