Housing Markets across India exhibit varying trends

Owing to the prevailing uncertainties, the capital values across markets registered slower appreciation in comparison to the growth recorded in 2010. Among the major cities, NCR, Bangalore, Chennai and Kolkata have registered higher escalation in property rates. Several residential precincts in these cities registered substantial appreciation in the range of 21-31% in property prices. Other markets such as Hyderabad, Mumbai and Pune witnessed slower growth in capital values. The appreciation in these markets was registered in the range of 2-13% during the year. During the year, select markets in Mumbai and Hyderabad also witnessed price corrections on account of moderation in demand. Mid-end markets across major cities, driven by inherent demand, have fared better in comparison to the high-end markets. Several mid-end markets have clocked growth of more than 25% in 2011.

The leasing market in the residential sector remained buoyant during 2011. Markets in proximity to the office districts and with better connectivity witnessed substantial demand during the year. Postponement of purchasing decisions by end users further propelled the demand for rental properties across most markets, especially during the second half of 2011. Cities such as Bangalore and Chennai witnessed maximum appreciation in rental values on account of increased demand. Select markets in these cities recorded rental escalations in the range of 45-55%. While majority of markets across India registered healthy demand, Mumbai can be singled out as the only market to register correction in rental values, primarily on account of prevailing high price points and increased availabilities.