India climbs 18 places in annual house price movement for Q3 2023

In the third quarter of 2023, India climbed 18 places in the global real estate price index to rank 14th, data compiled by Indian real estate consultant Knight Frank India showed. The 5.9 percent annualized increase in home prices in the quarter is significant for the nation's real estate sector.

Despite higher borrowing costs, home prices remained resilient, with average home values in the 56 markets covered by the Knight Frank Real Estate Price Index rising an average of 3.5 percent annually in September 2023, up from 2.2 percent in the previous quarter. The Global Real Estate Price Index tracks nominal and real price increases in 56 countries in their local currencies.

"Annual global house prices continue to rise despite rising interest rates, which have become the main weapon of central banks in fighting higher levels of inflation around the world," the real estate consultant said in a report. "Average annual price growth is 3.5 percent, approaching the pre-pandemic ten-year average of 3.7 percent. Of the 56 markets tracked, 35 experienced year-on-year price increases, while 21 experienced price declines.

Turkey tops the ranking with the strongest price growth since the beginning of 2020. The southeast corner of Europe occupies the top five positions in the ranking, with Greece (14.0 percent), Croatia (13.7 percent) and Northern Macedonia (11.0 percent) showing strong annual growth. Japan is the leader in real estate price growth in the Asia-Pacific region with an annual growth rate of 6.3 percent, followed by India with an annual growth rate of 5.9 percent.

The remarkable growth in India's residential market, despite the challenges of higher mortgage interest rates and the threat of inflation, is largely the result of sustained economic growth that has provided greater financial security to consumers. "In light of rising inflationary levels and rising interest costs, robust domestic economic fundamentals and growing aspiration for residential real estate are increasing demand among property buyers in the country's advanced housing markets," said Shishir Baijal, Chairman and CEO, Knight Frank India. "In addition, increased urbanization is creating an additional impetus for infrastructure development, creating opportunities for the development of new residential areas in India's urban centers." (ANI)