The latest data from PropTiger highlights a significant disparity in housing price growth across India’s top eight cities, with Delhi-NCR experiencing an astonishing 57% surge in average prices during the July to September 2024 period. In stark contrast, Hyderabad recorded a modest 7% increase, underscoring the varied dynamics of the real estate market. The average price per square foot in Delhi-NCR surged to Rs 8,017 from Rs 5,105 a year ago, while Hyderabad’s prices rose to Rs 7,050 from Rs 6,580. This widening gap raises critical questions about affordability and sustainable growth in these rapidly evolving urban landscapes.
The surge in prices in Delhi-NCR can be attributed primarily to heightened demand for high-end properties and a stagnant repo rate maintained by the Reserve Bank of India at 6.5% over the last ten policy meetings. As a result, both developers and buyers are burdened by high interest rates on loans, which further complicates the affordability issue. Meanwhile, other cities like Ahmedabad, Bengaluru, Chennai, Kolkata, and Mumbai saw varying increases ranging from 15% to 22%, showcasing a robust yet challenging market environment. With prices rising across these major urban centres, the implications for potential homebuyers and investors become increasingly complex.
The substantial price hikes, especially in Delhi-NCR, point towards a growing trend of resilience in the Indian residential real estate market. Senior executives in the sector emphasise that areas like Gurugram and Faridabad are witnessing a surge due to improved infrastructure, connectivity, and lifestyle amenities. However, this growth comes with a caveat; the drop in new launches and sales in southern states during the same quarter indicates a possible market correction, as stakeholders work to balance demand and supply to mitigate the risk of excessive unsold inventory.
Sustainability in urban development is more crucial than ever in this climate of rising prices and fluctuating demand. Experts argue that focusing on sustainable housing solutions is essential to ensure that growth does not come at the cost of affordability and accessibility for the middle class. A balanced approach that considers the social implications of rapid price appreciation is vital to maintaining the character of cities like Hyderabad and Delhi-NCR. As these markets evolve, the need for inclusive growth strategies that prioritise sustainable development alongside economic viability cannot be overstated.
