February 26, 2023
Property prices in 50 cities increase 7.1% year on year in Q3 FY23, according to NHB Residex
According to Residex, a housing price index (HPI) released by the National Housing Bank, residential property prices in 50 cities increased by 7.1% year on year during the quarter ended December 31, 2022, up from 4.5% the previous year (NHB).
NHB Residex publishes three housing price indices: 'HPI at assessment prices,' 'HPI at registered prices ‘and ‘HPI at market price’ for under-construction properties.
'HPI at assessment prices' tracks the movement of residential property prices in 50 cities on a quarterly basis, using FY 2017-18 as the base year, and is based on valuation prices collected from primary lending institutions.
On an annual basis, 44 of the 50 cities experienced an increase in the index, while six experienced a decrease. Gandhinagar's HPI increased by 21.4 percent, while Ludhiana's decreased by 11.6 percent.
Ahmedabad (14.4%), Bengaluru (8.0%), Chennai (8.7%), Delhi (1.8%), Hyderabad (10.2%), Kolkata (7.4%), Mumbai (4.4%), and Pune (7.2%) all saw an increase in the index on an annual basis.
On a quarterly basis, the 50-city index increased by 1.5% in October-December 2022, compared to 1.2% in the previous quarter. Since June 21, the index has shown an increasing trend on a quarterly basis.
The index increased in 40 of the top 50 cities during the quarter, with Kochi recording the highest sequential improvement of 6.4%, while Ludhiana, Delhi, Dehradun, Nagpur, Navi Mumbai, Raipur, Bhiwadi, Bidhan Nagar, Howrah, and New Town Kolkata recorded sequential declines in the 'HPI at assessment price'.
The 'HPI at market price for under-construction properties,' calculated using quoted prices for under-construction and ready-to-move unsold properties for 50 cities, increased by 10.8 percent year on year in the October-December 2022 quarter, compared to 2.9% the previous year. Lucknow saw the greatest increase (41.2%), while Rajkot saw a 3.4% decrease.
On a quarterly basis, the 50 city index increased by 3.1% during the quarter, compared to 3.7% in the previous quarter. The rising cost of construction is having an effect on property asking prices.
According to NHB Residex, the indices have been steadily rising since covid-19. The progress has been more noticeable in tier II and tier III cities.