(Bloomberg) -- Buying homes in major Indian cities has become costlier as rising demand for luxury units has boosted overall property prices, according to real estate consultancy firm ANAROCK.
The average house price in top seven cities, including the capital New Delhi and the financial hub Mumbai, climbed 23% from a year earlier to 12.3 million rupees ($145,707) during April-September, the Mumbai-based company said in a report on Wednesday. More than 227,400 units were sold in those urban areas during the first half of the fiscal year, it said.
“Despite a 3% drop in overall unit sales, the total sales value outstripped that of a year ago by 18%, clearly demonstrating the unrelenting demand for luxury homes,” said Anuj Puri, chairman of the Mumbai-based company.
Developers in the South Asian nation are racing to build new residences to match the rising demand. DLF Ltd., the country’s largest real estate developer by market value, announced that new sales bookings in the first quarter more than tripled to 64 billion rupees, with the builder expecting bookings of 170 billion rupees in the fiscal year ending March 2025.
Overall equity investments in India’s real estate sector are set to hit a record this year, surpassing $10 billion for the first time, according to a joint report by CBRE South Asia Pvt. and the Confederation of Indian Industries. It’s driven by a resurgence in inflows in built-up office assets and a strong acquisition pipeline for land in the residential sector, it said. Cities such as the NCR region, Mumbai and Bengaluru remained the preferred markets, the report said.
Bloomberg News reported earlier this year that wealthy Indians living abroad are snapping up luxury homes in the nation. They are expected to make up almost a fifth of all home sales by 2025, according to a report by Bengaluru-based property platform NoBroker.com.
The Mumbai Metropolitan Area witnessed the largest sales volume, followed by Pune, a city in the Western state of Maharashtra, and the National Capital Region, which includes Delhi and its neighboring areas, ANAROCK said.
The NCR saw the highest jump in average property price, advancing 56% to more than 14.5 million rupees, it said. Bangalore came in second with 44%, followed by Hyderabad with 37%.
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