PROPERTY PRICES MOVE UP: MAKAAN.COM STUDY
PROPERTY PRICES In India have moved up In the last 12 months, according to a March report released by property research firm Makaan.com.
Makaan.com's property Index, which covers six cities, stood at 1,117 compared with 954 in the corresponding month last year, an increase of over 17%. The rise Is attributed to the hardening of property prices in Mumbai and Pune, which rose by 29.4% and 28.1%, respectively. Prices In Delhi rose by 6.8% during the same period.
Hyderabad, Bangalore and Chennai that corrected by 32%, 2.5% and 1.4%, respectively, over the last one year also put pressure on the index.
The report said, "Prices fell in the first half (January-June period) of 2009 when the Index dropped from 1,000 to 946. This period was marked by complete lack of interest among Investors and homebuyers In making long-term high-value purchase decisions. As the economy started reviving, consumers became more confident about their future earnings. Property prices, too, started rising (July-December period) with the Index reaching 1,128 In December 2009."
November and December saw two interesting trends, the report said. First developers In Mumbai, Bangalore and Delhi Increased the prices of existing projects. Second, new launch prices were significantly higher than prevalent rates.
On the January to March period, Adltya Verma, business head and vice-president, Makaan.com, says, "This steep rise led to crowding out of homebuyers as they were caught off guard with this unexpected jump. This led to lower transactions during the January-March 2010 period."
Various panels In the country are working on a property Index to benchmark rates. The Reserve Bank of India has recently initiated an exercise to set up a housing start-up index to track new projects In 31 cities and measure the changes In construction activities. The National Housing Bank already has a property index that tracks residential rate movement in 15 cities.