The National Property Index has remained stagnant during the fourth quarter, at the same level as that in the third quarter, with ready-to-move properties witnessing a price fall of 0.4% and under-construction properties witnessing a price rise of 0.8%. But the quarter witnessed steep price increase in properties in Kolkata, with properties in localities like Anwar Shah Road witnessing a price growth of 23.2%. Although considering the overall quarterly impact the prices in the eastern part of India remained stagnant, the south was the only region that experienced a price hike, while the north on the other hand saw prices fall, said Sudhir Pai, CEO of Magicbricks, a repository of residential property listings.
The real estate sector saw both general prices dip and ready-to-move prices suffer due to the pressure of demonetisation. At an average, western India has done better than other regions with a 9% price increment in its cities, Pai said, adding, “Although the real estate market in India saw an initial dip after demonetisation, the market at present has finally stabilised and is catching back.”
However, Samantak Das, chief economist and national director research of Knight Frank, one of the leading global property research firms, said due to demonetisation, the current sentiment has seen a drastic fall to below the threshold mark of 50 to become the worst quarter in the last three years. The last quarter was significantly bad compared with the earlier six months and its effect continued during the fourth quarter. Although the impact of demonetisation on the Indian real estate industry was short term, it had offset the growth witnessed during the last six months. The recovery in real terms would not happen before 2018.
According to Knight Frank Research, residential sales dipped by 40% in eight major cities, but Magicbricks pointed out that price decline was restricted to certain areas like Noida, Gurgaon and Ghaziabad. In places like Hyderabad, Greater Noida, Thane, Bengaluru and Navi Mumbai, prices went up 0.5-2.5%.