Property prices are expected to rise by 5 to 6 percent.
According to a statement from credit rating agency ICRA.
ICRA, the credit rating agency, has estimated that the real estate sector in the country will perform well this year, with the potential for double-digit growth in housing sales. It indicated that residential sales in the seven major cities of the country are expected to achieve double-digit growth during this fiscal year. Additionally, it predicts that average property prices may increase by 5 to 6 percent and that demand for home ownership will rise in Tier-2 markets. ICRA has released a real estate report for the fiscal year 2024-25, stating that, given the demand from buyers, real estate sales are expected to grow by 12 to 14 percent annually, reaching between 785 to 800 million square feet.
According to ICRA’s estimates, average property prices are expected to rise by 5-6% in the current fiscal year, compared to an 11% increase in the previous fiscal year. The report highlights that demand for real estate has increased in Tier-2 cities as well, with trends similar to those observed in metro cities, particularly a move towards premiumisation. In this context, several branded developers are examining opportunities in Tier-2 cities.
Furthermore, launches in the seven major cities of the country are estimated to increase by 12%, reaching 767 million square feet. ICRA also predicts that cash flow from real estate transactions will improve by 9-11% this fiscal year, while loans are expected to grow by 6-7%. These loans are expected to fund new business developments and land acquisition. Additionally, ICRA anticipates that due to increased unit sales and higher average sale prices, collections for the fiscal year ending March 31, 2025, will grow by 19-21% annually.
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