The real estate market is now witnessing a surge in property values.
The market for new residential property, which has been rising since April-end, is on a high.
In the latest figures, the market has recorded a growth of Rs.8,500 crores in the last three months, compared to Rs 5,500 in March.
This is despite the fact that the market in terms of new residential properties in the country is still recovering from the initial shock.
This has led to a surge of sales and a sharp increase in the real estate value, said Naveen Thakur, president, Naveer Nair, a real estate research and consulting firm.
The market has also witnessed a strong demand for properties in major urban areas and this is reflected in the rising sales, he added.
The real estate sector is also witnessing a rebound in property prices in the city-states of Maharashtra and Gujarat, which have seen significant gains in the market since the beginning of the year.
The average price of a new property in Maharashtra, for instance, increased by Rs.3,000 in March, to Rs 3,900 crore from a little over Rs 1,000 crore in March last year.
In Gujarat, the average price is at Rs 3.4 lakh crore from an average of Rs 2.7 lakh crore in the previous month.
“The market is recovering and the buyers are buying more properties,” said Kirti Ranganathan, president of the Naveed Akhil Trust, a residential real estate brokerage.
“There are very few properties available in the cities and most of them are in big and relatively well-known commercial corridors.
The buyers are also finding a good mix of buyers.”
The average transaction price of new houses in Mumbai has been increasing at a rate of 8 per cent a month since the start of the financial year, and it is estimated that more than a million new homes have been sold.
Ranganathan said that the growth of the market was also reflected in an increase in new residential transactions in Gujarat and Maharashtra, which witnessed a sharp jump of 2 per cent and 5 per cent respectively.
“The new houses being sold are not priced at such a premium that it has become unaffordable for the buyers.
The increase in prices reflects this,” he said.
While a rise in the number of sales in the residential real property market has been a major factor in the increase in value, the realisation of the demand for commercial properties in Mumbai, Gujarat and Mumbai is also contributing to the rising market value.
“This is because many of the buyers were looking for a residential property at a lower price.
The increased demand for residential properties was also evident in the recent sales of commercial properties,” Thakurs said.
“It is important that the builders of new commercial properties have a clear plan in mind.
It is important to make sure that the land is developed for residential and commercial purposes,” he added