Housing prices in top Indian cities rise 11% YoY in Q3 2024, with Delhi NCR leading the growth | Representational Image
Housing prices across the top eight markets in India increased by 11% year-over-year (YoY) to INR 11,000 per sq ft in Q3 2024, driven by strong demand and positive market sentiments. This marks the 15th consecutive quarter of rising prices since 2021, according to the housing price tracker report for Q3 of 2024 published by CREDAI–Colliers-Liases Foras.
Delhi NCR saw the highest annual increase at 32% YoY, followed by Bengaluru at 24% YoY. Despite record-high sales over the past two years, demand across top cities is stabilizing, though residential activity is expected to remain strong in the last quarter of 2024.
Unsold inventory dropped for the third consecutive quarter due to healthy uptake in housing units. By September 2024, unsold inventory across the eight major cities was over 1 million units, with MMR holding the largest share at about 40%. Hyderabad saw a slight quarterly dip in unsold units despite a 28% annual increase.
Boman Irani, President of CREDAI National, noted the rise in housing prices reflects positive buyer sentiments and a favorable real estate market. He highlighted an increase in demand for larger homes, contributing to price rises. Irani anticipates this momentum will continue into the new year, hoping for rate cuts soon.
Badal Yagnik, CEO of Colliers India, remarked that the housing market is stabilizing, supported by strong fundamentals. “Developers are adjusting strategies, particularly in price-sensitive segments, by offering compact units. Despite an 11% YoY growth in average prices in Q3 2024, potential monetary easing and repo rate cuts could provide financial relief to homebuyers. Flexible payment plans and incentives will continue to boost sales,” he said.
Pankaj Kapoor, Managing Director of Liases Foras, pointed out that both sales and prices are rising, indicating steady demand and affordability. The luxury segment remains dominant, though new launches are declining. While MMR, Pune, and Hyderabad are nearing a plateau in sales and supply, NCR, Chennai, and Tier 2 cities face a supply shortage and may see increased launches.
Delhi NCR led the price increase at 32% YoY, driven by the luxury segment. Dwarka Expressway and Golf Course Extension/Sohna Road saw significant price appreciation over 50% YoY. Compared to early 2020, average prices in the region have grown by about 75%, supported by strong demand for larger units.
Despite high unsold inventory, levels dropped for the third consecutive quarter. Pune saw the highest annual decline in unsold inventory at 13%, marking its fifth consecutive quarter of decline. Chennai and Kolkata also saw significant annual drops of 7-9%. Seven out of eight cities reported a quarterly decrease in unsold inventory.
Vimal Nadar, Senior Director at Colliers India, stated that developers are cautious with new launches due to high unsold inventory, reassessing target audiences in high-demand areas. While affordable housing launches have moderated, offerings in luxury and ultra-luxury segments have increased. Average prices for larger units, particularly 3-4BHK configurations in Bengaluru and Delhi NCR, rose by up to 26% YoY in Q3 2024.
