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Housing prices drop by 1.3% in Bhopal

If you have some savings to invest and with the stock market not the best place to be in, the housing sector may not be a bad bet.

bhopal Updated: Aug 29, 2013 10:31 IST
Rahul Noronha
Rahul Noronha
Hindustan Times

If you have some savings to invest and with the stock market not the best place to be in, the housing sector may not be a bad bet.

Prices of houses have recorded a drop in Indore and Bhopal during the April-June quarter, compared to the previous quarter as per the latest National Housing Bank (NHB) Residex -- an index reflecting property prices.

The latest report of NHB Residex records a 5.64% drop in prices of houses in Indore -- the second highest in the country in the April-June quarter this year -- and a 1.30% drop in prices in Bhopal during the period.

The NHB, under the Reserve Bank of India (RBI), surveyed 26 cities in the country of which 22 recorded negative growth.

The last time the industry recorded a drop in prices was in July-September quarter of 2011, when 10 of the 15 cities surveyed showed a decline in prices. It has since recorded a positive growth.

Simply, with prices falling, this is the time to buy. Builders would now have to negotiate prices more than ever as they are keen to release inventory.

Among the 22 cities surveyed, Ludhiana has recorded the biggest drop (5.99%), followed by Indore ( 5.64%), Vijayawada ( 5.43%), Hyderabad ( 4.55%), Kolkata ( 4.06%), Guwahati (3.92%), Kochi (3.37%) and Patna (3.29%).

Raipur in neighbouring Chhattisgarh also recorded a decline of 0.65%, while other state capitals like Ahmedabad posted a drop of 3.13%, Jaipur 1.79%, Bhubaneswar 1.02% and Bangalore 0.92%.

The four cities that managed to buck the trend and recorded an appreciation in prices were Nagpur with 3.07%, Lucknow with 2.19%, Surat with 1.43% and Dehradun with 0.55%.

Builders and industry insiders, however, disagree with the findings of the survey.

“The overall downturn felt by all sectors is also being felt by housing. However, since Bhopal is an end-user market, prices in any case are low and would not go down further.

Moreover, the April-June and July-September quarter has low sales in any case,” said Vipin Goyal of Raksha builders.

“We have, in fact, increased prices as the cost of inputs and taxation rates are so high. The large number of advertisements being seen is not because of slump in the industry, but we are entering the buying season,” said Ajay Mohgaonkar of Fortune builders and president of MP chapter of CREDAI.

First Published: Aug 29, 2013 10:24 IST