Indian housing prices have grown nearly 6% over the past year, showcasing a remarkable renewal of interest in real estate buying since the pandemic. In the process, India has jumped a whopping 18 spots to hit the 14th position globally in residential property price increase.
This, despite the increased interest rates on home loans making buying a villa or a flat that much more expensive, according to the Knight Frank Global House Price Index — Q3 2023, unveiled Friday afternoon.
India’s growth in housing prices at 5.9% is way above the global average of 3.5% year-on-year, based on the average from the 56 countries surveyed by Knight Frank for this global survey.
“Robust domestic economic fundamentals and the escalating aspirational attributes of residential real estate are driving heightened demand among homebuyers in prominent residential markets within the country,” said Shishir Baijal, chairman and managing director, Knight Frank India. “Upsurge in urbanisation is providing additional momentum to infrastructure development, paving the way for emerging residential hubs in the urban centres of India,” he added.
“(This) showcases the resilience of our real estate market…positioning India attractively for global real estate investment,” said Avneesh Sood, director, Eros Group.
The Indian residential real estate market’s stellar performance is even more surprising considering how prices were either stagnant or had declined all through much of the 2010s. Demand, too, was noticeably low during this period. “However, post-Covid, we observed a substantial revival in demand, surpassing the previous highs,” said Prashant Rao, managing director of Poulomi Estates, a Hyderabad-based real estate developer.
"Several factors contributed to the rise in property prices, including pent-up demand, a desire to upgrade, a willingness to spend more for better and modern amenities,” Rao added.
A note issued by Knight Frank said that Indian residential realty’s stellar performance is the result of “stable economic growth which has lent itself to providing greater financial security to end-users.”
However, the best performing region globally has been Southern Europe, with five countries out of the top 6 hailing from the nearabouts of the Mediterranean. On top is Turkey, which has had an eye-popping rate increase of nearly 90%, followed by Croatia, Greece, Colombia (in South America), North Macedonia and Bulgaria.
The top performing residential realty market in Asia is Japan, which grew 6.3%, followed by India.
