India house prices on track for steady rises, affordability to worsen: Poll
India are set to rise steadily in single digit percentages over the coming years along with economic growth, according to a Reuters poll of property analysts who expect affordability for first-time buyers to worsen.
Following a relatively modest 250 basis points of interest rate rises from the Reserve Bank of India to 6.50%, expectations of a resilient economy have underpinned property market strength, along with relentless demand for housing.
Average home prices were expected to rise 7.0% nationally this year and next, according to the Aug. 14-31 Reuters poll of 12 property analysts, up from 6.0% and 5.5% in a June poll.
The outlook was more upbeat and stable compared with companion polls of property markets in developed economies, where house prices are expected to fall or stagnate after surging as much as 50% during the COVID-19 pandemic.
There was no such panic buying of property in India during the past three years, with modest rises of 2-3% annually leaving more room for house prices to climb.
«Multiple factors are driving the real estate market in India: a healthy economy, market optimism, higher estimated GDP, economic diversification...(and) inflation is under control, which is adding to renewed optimism,» noted Ankit Kansal, managing director of 360 Realtors.
While July consumer price inflation was running well above the top end of the RBI's 2-6% tolerance range, it is expected to ease back over coming months as food price inflation subsides.
