Delhi ninth fastest growing home market
The city, known for its tight housing supply, moved up by one place and has been ranked as the ninth fastest growing prime residential market, according to the latest Prime Global Cities Index by property advisory Knight Frank.Updated: Nov 20, 2019 07:36 IST
New Delhi has retained its position as a prime residential market among top global cities and witnessed an uptick in prices in the September quarter, even as India faces its worst ever housing crisis.
The city, known for its tight housing supply, moved up by one place and has been ranked as the ninth fastest growing prime residential market, according to the latest Prime Global Cities Index by property advisory Knight Frank.
Weighted average home prices in the city’s prime locations such as Greater Kailash, Vasant Vihar, Anand Niketan, Defence Colony and Green Park rose 4.4% to Rs 33,511 per sq. ft in the September quarter, compared to a year ago.
From the preceding June quarter, New Delhi and Mumbai have moved up by one and two places, respectively, to ninth and tenth ranks, while Bengaluru has slipped five places from the 15th rank in Q2 to 20th rank in Q3 2019.
The report is a valuation-based index that tracks the movement in prime residential prices in local currency across 45 cities worldwide. Moscow leads the index in the September quarter with prime home prices rising by 11.1% over the 12 months to September 2019, followed by Frankfurt (10.3%) and Taipei (8.9%). Seoul was the weakest-performing global city in the year to September, with luxury home prices falling by 12.9%.
“While Delhi and Mumbai have moved up in their rankings, luxury home prices have remained stable in both the cities in the past three months. In India, all the policy initiatives have been focused on boosting the development of affordable and mid-income housing, which has left the luxury property development a game for well-funded and organised developers to play,” said Shishir Baijal, chairman and managing director, Knight Frank India.
Sales of luxury homes in the country have been tepid in the last three years or so, as most developers seem to have overestimated the capacity of homebuyers in cities such as Mumbai, the financial capital. To push sales and bring back buyers, most real estate firms are entering the mid-income or budget housing category, which has received maximum government incentives and support and where the real demand seems to be.
Around 76% of the cities registered static or rising prices over the 12-month period till September, 2019, the Knight Frank report said.
High-end residential locations in Mumbai, the country’s most valuable property market, for instance, witnessed a 0.8% year-on-year rise in prices to Rs 64,775 per sq. ft as of September. Prime locations in Bengaluru, considered to be a relatively better selling housing market, recorded a 2.1% rise in capital values to about Rs 19,709 per sq. ft. Nearly 10,000 residential units, that are ready but unsold, across the top seven cities are in the luxury and ultra-luxury segments priced over Rs 1.5 crore, according to an October report by Anarock Property Consultants. Mumbai Metropolitan Region (MMR) and National Capital Region (NCR) have maximum ready unsold stock in the luxury and ultra-luxury segments, both accounting for nearly 66% of the total 10,000 available, ready units.