Housing price growth likely to moderate next year

Interest rate cuts, strong rental demand may keep the market buoyant in 2025

- HIMALI PATEL

Housing prices rose at a brisk pace in 2024. While the market may remain resilient, the pace of price growth is expected to moderate in 2025.

Amid high and rising prices, buyers need to assess their financial preparedness before making the purchase decision.

Rapid price rise

Residential property prices across markets have risen by 5-10 per cent over the past year. "Certain markets in North India, such as Delhi-NCR and Chandigarh, saw price increases exceeding 14-15 per cent," says Pankaj Kapoor, managing director, Liases Foras.

According to data from Colliers and Liases Foras, the average price at the end of September 2024 across eight top markets stood at ₹11,000 per square foot, up 11 per cent year-on-year (Y-o-Y). In specific segments of some markets, the increase was sharper.

"Cities like Bengaluru and Delhi-NCR saw price increases of up to 26 per cent Y-o-Y for 3-4 BHK units, in the July-September quarter," says Vimal Nadar, senior director and head of research, Colliers India.

While demand remained high, supply was constrained. "Slowdown in approvals, due to the general elections in the first half and state elections in the second, resulted in tapering down of new launches," says Anuj Puri, chairman, Anarock Group.

According to him, prices also increased due to rising input costs and strong demand.