Housing Demand Hits 16-Year High, Homes to Surge by Up to 30% This Year

In all major cities of the country, the demand for housing has reached unprecedented levels. Data from the National Housing Bank reveals that the demand for homes priced at over 25 lakh rupees has surged by 32% in a year. In the fiscal year 2021-22, approximately 10.60 lakh houses were sold across the country. This number rose to 14 lakh houses in 2022-23, and in 2023-24, it escalated to around 18 lakhs, marking a staggering 29% increase.

In the upcoming financial year, this figure is anticipated to further rise by 28%, surpassing 23 lakhs. These statistics indicate a rapid growth in the real estate market throughout the nation. This trend is observed not only in metropolitan cities like Mumbai but also in cities like Bhopal, Indore, and Ranchi. Experts suggest that this rapid growth is being witnessed for the first time since 2008.

Property Prices Surge by 47% in Two Years, Cementing Challenges for Buyers

On the flip side, property prices are also witnessing a substantial increase. Data from the National Housing Bank illustrates a staggering 47% surge over the span of two years. Cities like Jaipur, Raipur, Chandigarh, and Patna have seen property prices escalate by 5 to 7.5 thousand rupees per square foot, compared to the pre-COVID era when prices ranged from 4 to 5 thousand rupees per square foot. 

According to experts, property prices may soar by an average of 30% this year. This surge is attributed to the rise in prices of materials like cement, iron, and others.

Navigating Rising Property Prices and Costly Mortgages Amidst Strong Demand

With robust demand, soaring prices, and increasing labor costs, land values are also skyrocketing, and this trend is expected to persist in the near future.

What’s the Best Strategy for Affordable Home Buying?

The path to affordable home buying seems challenging amidst consistent price hikes. Following the Reserve Bank’s upcoming policies, if various banks reduce interest rates on home loans, then property prices may escalate significantly or, conversely, the impact of reduced EMIs might be minimal.

Why Are Property Prices Rising Even After COVID?

The reason is crystal clear. Everyone wants to own a home, and where demand remains strong, prices will continue to rise. This is the fundamental rule of the market. As you can see, land values are increasing in every city. There are no indications of a decrease in cement and iron prices. Labor costs are also on the rise. This momentum is likely to continue.