Track2Realty Exclusive Yearly Analysis: India has led the list of top-performing housing markets globally with a 284 per cent real rise in prices since 2001, which is equivalent to an average annual rise of 14 per cent, according to the Lloyds TSB International Global Housing Market Review.
Though trends vary by city, prices in most Indian urban centres have doubled since the property market boom began in 2006-07, driven by growing numbers of middle class Indians looking to invest in real estate as well as speculators.
But prospective home buyers are being held back by a slowing domestic economy and great uncertainty across the globe.
“Although in nominal terms house prices are expected to rise, once you adjust for inflation, which is more than 7 per cent, prices in real terms are stagnant. The economic situation in India and abroad is not giving enough confidence to homebuyers, who feel it is better to wait and watch, “says Samantak Das, Director of Research and Advisory at Knight Frank.
Interest rates on home loans, which range from 10 to 14 per cent, will probably not fall any time soon either. With prices rising and buyers required to pay around 25 per cent of the total cost of the house as a down payment, it has become increasingly difficult to buy a house.
In most of the urban centres across India, average house prices are expected to rise this year, even though demand for homes has fallen significantly over the last year.
