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Residential property prices have largely remained stable in 2017-18, going by NHB Residex, the country’s official residential property price index.
With residential property prices remaining stable this is a great time for home buyers to buy property as the speculative activity, which was artificially pushing up prices earlier is not there now, Sriram Kalyanaraman, Managing Director and CEO, National Housing Board, told BusinessLine .
“The entire residential property market has now changed to sort of end-user-driven market,” said Kalyanaraman.
Currently, NHB Residex captures two housing price indices – HPI@assessment prices for 50 cities – and HPI@market prices for under-construction properties for 50 cities. These HPIs track the movement in prices of residential properties on quarterly basis, taking financial year 2012-13 as the base year.
The composite HPI@assessment prices for 50 cities showed an increase of 7.6 per cent between March 2016 and March 2017; it remained stable between March 2017 and March 2018. This index has moved up at a CAGR of 4.5 per cent over the years.
Some of the cities where there has been an increase in HPI@assessment prices at March-end 2018 on a year-on-year basis are: Ahmedabad (8.1 per cent); Chakan (8.8 per cent); Patna (7.9 per cent); Ranchi (21.8 per cent) and Surat (11.2 per cent). Metros such as Bengaluru, Chennai, Kolkata and Delhi saw a decline in property prices on a year-on-year basis under HPI@assessment prices. “The big message is that prices are remaining stable. In some cities where infrastructure development is happening, prices are going up. For example, Kochi has seen some increase due to Metro development,” he said.
Expansion to new cities
In the coming years, NHB is confident that the coverage of Residex will be expanded to 100 cities.
Delinquency at lower levels remains a bit high. Data does not point to a gloom-and-doom scenario in housing, especially in affordable housing, said Kalyanaraman. Data also does not indicate a worsening trend on the asset quality front, he added.
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