Housing prices increased by an average of far as a result of rising building costs and stifled demand. The Real Insight report states that in comparison to the year 2021, the average home price in eight major cities rose by 7% last year, reaching between Rs 6,700 and Rs 6,900 per square foot.
According to the report, the effects of COVID-19 pandemic on consumer demand in 2020 and 2021 resulted in dampened customer demand, which meant that the price increase for residential properties had no effect on sales throughout 2022.
Vikas Wadhawan, CFO PropTiger.com, Housing.com, and Makaan.com, said that housing costs were relatively steady between 2016 and 2021 but began to rise in 2022 as the cost of imported building materials rose due to the global headwinds like the Russia-Ukraine war.
He said that the uptick in demand for both newly completed homes and those that were already finished also contributed to the small single-digit increase in prices. He stated that builders were compelled to increase the basic selling price of flats due to the rise in overall building costs.
According to the report, Gurugram saw the biggest price rise of around 13%, followed by Bengaluru and Delhi-NCR with 9% price growth and Pune with 8%. Each of Kolkata and Ahmedabad witnessed 7% rise.
Although the cost of inputs, particularly steel, has decreased slightly, other material costs remain high. However, it is observed that as demand remains high, house prices will increase by just a small percentage in 2023.
FAQs.
1. Which city has had the highest price rise in recent years?
Gurugram experienced the greatest price increase, nearly 13%.
2. Who is Vikas Wadhwan?
Vikas Wadhwan is the CFO of PropTiger.com, Housing.com, and Makaan.com.
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