In the wake of Modi’s landslide victory, the property market is expected to make strides, and consequently property prices in India are expected to rise.
According to the most recent Housing Sentiment Index (HSI), homebuyers in India in eight of ten cities fully expect prices to rise over the next six months. An HSI score of 100 indicates that prices will remain flat, or stable. Anything below indicates prices will fall, and above will rise. The national score has been reported at 108, with Mumbai seeing the first ever change to a positive number on the index, rising to 106. Keen buyer interest in well-performing submarkets such as Thane and Navi Mumbai are said to have contributed to this, and a strong demand for properties in the area will likely see prices soar over the coming six months. The highest performing city on the HSI index was Bangalore, reaching an impressive 140.
What do rising property prices mean for investors?
It has long been speculated that prices would rise as buyer confidence returned to the market after the elections, and the recent survey results confirm this assumption.
This anticipated price growth is excellent news for investors looking to purchase new developments at competitive entry prices, and earn a handsome return on investment. Submarkets around major cities receiving boosts to infrastructure and rapid property development are proving to be particularly lucrative; the demand for housing in these areas is high, and with the buyer sentiments matching the property forecast released by analysts earlier in the year, the rate of price growth is anticipated to be high as well. Buyers in primary markets like Ahmedabad, Mumbai, Hyderabad and Pune were surveyed, among others, suggesting prices here are poised to rise throughout the remained of 2014. Indeed, predictions made earlier in the year have suggested that price appreciation would be endemic to these markets after the elections, and with the most recent HSI results confirming this, investors would be smart to invest in property here sooner rather than later.
For NRIs considering property investment in India, now is the time to buy in order to benefit from this price appreciation – not budget for it!
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