Property rates have increased by 3% to 49%.
Investors are making significant purchases.
Actual homebuyers are facing hardships due to the rising prices.
The dream of owning a home for the common person remains elusive, primarily due to rising property rates. As real estate has become a key business, the aspirations of ordinary people for their own homes continue to fade. With significant profits in the real estate market, many investors are pouring money into this sector, which in turn is causing challenges for genuine homebuyers.
As more investors enter the market, prices continue to rise accordingly, making home purchases increasingly burdensome for average buyers. In micro markets like Gurugram and Noida, home prices have surged by 20% on an annual basis. At the same time, new launches have decreased, preventing property prices from falling, which has led to a decline in purchases as well.
According to Dhruv Agarwala, CEO of Housing.com, property rates in major cities across the country have increased by 3% to 49%. Delhi saw the highest increase at 49%, while Hyderabad experienced a 3% rise. He explained that as property prices continue to rise consistently, investors naturally shift their focus in this direction, showing interest in purchases. This, in turn, leads to further price increases.
All these developments are turning into a cause for concern for those genuinely looking to buy a home. They find themselves in a position where they have to spend significant amounts of money beyond their means. If this trend continues, true homebuyers may find it increasingly difficult to purchase a house.
He mentioned that “this situation will arise soon.” In the first half of this year, there was a mixed response in home sales. Compared to the first quarter, the second quarter saw a decline. For the first time in two and a half years, there was a drop in home sales, according to Anarock data. Notably, sales decreased during the April-June quarter. In the January-March quarter, 130,340 units were sold, but in the June quarter, this figure fell by 8% to just 120,340 homes.
Cities like Hyderabad, Kolkata, Bengaluru, Chennai, Pune, and Mumbai reported declines. Additionally, according to Housing.com data, 120,642 homes were sold in Q1, but this dropped by 6% in Q2 to 113,768 units. Declines were also noted in Ahmedabad, Chennai, Hyderabad, Kolkata, Pune, and Mumbai.
In Delhi and Bengaluru, there was a slight increase observed. Notably, units priced over Rs 1 crore accounted for 40% of the total sales in the last quarter. Additionally, a recent project launch in Gurugram saw all the flats booked within hours, driven by NRIs and high-net-worth individuals choosing Gurugram for their investments.
On the other hand, new launches have somewhat declined. According to Housing.com, 103,020 new units were launched in the January-March quarter, but this dropped by 1% to 101,677 units in the June quarter. Hyderabad saw the highest decline at 58%, while Kolkata reported a decrease of 49%. Chennai experienced a 2% drop, and Pune saw an 11% decline. However, launches increased by 110% in Ahmedabad, 17% in Delhi, 26% in Bengaluru, and 10% in Mumbai.
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