Kolkata, Chennai sees highest rise in property prices; Delhi lags

The property prices are likely to keep fluctuating till elections.

Real estate is showing signs of revival. Residential property prices in 12 cities, including Mumbai, Hyderabad and Chennai, rose during July-September quarter, as compared to a year ago, according to the National Housing Bank (NHB) Residex.

However, in April-June, 22 cities, including Delhi, Mumbai, Pune, Bangalore and Chennai, saw a slump in prices after two years. Experts had said developers were resorting to price cuts to spur demand.

Now, with prices moving up, it seems real estate would soon rebound, a person tracking the sector said.

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However, an executive with a leading developer said it was too early to comment on where the sector was moving and whether it would revive soon. 

“The prices will keep fluctuating till elections. Only after there is some stability in the economy and political environment, will the prices move in a direction.” 

During July-September, the rise was most in Kolkata, 5.3 per cent jump, followed by Chennai, 4.95 per cent; Hyderabad, 4.77 per cent; Ahmedabad, 2.69 per cent; Lucknow, 2.14 per cent; Surat, 2.12 per cent; Patna, 2.04 per cent; Guwahati, 1.36 per cent; Raipur, 1.29 per cent; Faridabad, 0.99 per cent, Chandigarh, 0.53 per cent; and Mumbai, 0.46 per cent.

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In the same period this year, the prices fell in 10 cities, of the total 26. 

The most was in Meerut (6.88 per cent fall) followed by Delhi (4.53 per cent) and Ludhiana (4.46 per cent).

Vijayawada showed a decline of 4.03 per cent; Nagpur, 3.58 per cent; Bhopal, 3.09 per cent; Indore 2.18 per cent; Jaipur, 1.82 per cent; Bhubaneswar, 1.03 per cent; and Bangalore, 0.93 per cent.

The prices were stagnant in Pune, Kochi, Coimbatore and Dehradun. Residex has been tracking the movement in prices of residential properties on a quarterly basis since 2007. 

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From the quarter January-March this year, NHB Residex has been expanded to include six new cities -- Chandigarh, Coimbatore, Dehradun, Meerut, Nagpur and Raipur.

The data on the transactions are collected from diverse sources and are classified, validated and applied to the model designed to give the representative index for each city.

The data based on actual transactions are put through a model that depicts the trend in the market.

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The Residex is expected to bring greater uniformity and standardisation as well as greater transparency in the valuation of properties across the industry, according to NHB.

The real estate industry has been battling a phase of low sales and high inventory. 

Developers have been giving freebies with purchase of flats since last few quarters to spur the demand and boost sales.