Even as residential property prices move skywards elsewhere,two of the countrys biggest metros,Delhi and Kolkata,are bucking the trend,reporting a decline of up to 15 per cent in the first quarter of this calendar year,said the housing regulator.
According to the Residex for the period January-March 2010,a residential property index put together by the National Housing Bank (NHB) for the 15 biggest metros,the residential property price in these two metros have come down sharply,signaling a correction in the market. While in Delhi property prices have crashed by 7 per cent as compared to July-December 2009,in Kolkata the decline has been sharper at 15 per cent.
In case of Delhi,the prices have fallen by nearly 20 per cent from the peak levels during July-December 2008,a time when the economic slowdown was beginning to spread its tentacles. The index assumes 2007 to be the base year.
In Delhi,the market has seen a huge correction in residential property prices,which was much required. As state land development agency Delhi Development Authoritys (DDA) plans to come up with DDA colonies around farm areas beyond Mehrauli fructify,there is no big pressure on demand. Supply is expected to grow,said National Housing Bank Executive Director RV Verma.
At the same time Faridabad,which falls within the National Capital Region (NCR) and is situated at a distance of around 30 km from Delhi,has seen a sharp rise of 47 per cent in housing prices compared to January-June 2008.
Faridabad is emerging as an investors market. Starting with a relatively lower price base,the market is far from saturated. Given its proximity to Delhi,this satellite city has a vantage position, said Verma. As this city gets connected to the rest of Delhi by Metro,the prices are likely to rise.
Four other metros,which have reported a sharp upswing in prices compared to the July-December 2009 period are economic growth centres like Bengaluru,Mumbai,Pune and Chennai. These cities have seen a rise in prices because of a vibrant local economy,mostly driven by the
Information Technology sector. The growth has helped to revive the economy,presented better employment opportunities,impacted salaries leading to regeneration of demand for housing, Verma said.
While Bengaluru and Chennai witnessed a 10 per cent rise,Mumbai recorded 6 per cent and Pune saw a 13 per cent increase,according to the NHB data. The housing demand is driven by young couples in these cities. Bengaluru and Pune have also emerged as post-retirement destinations, Verma added.