India has moved down 7 spots in the global home price index to the 54th rank in Q3 2020 from the 47th rank it had achieved in Q3 2019, with a decline of 2.4% year-on-year in home prices.
India has moved down 7 spots in the global home price index to the 54th rank in Q3 2020 from the 47th rank it had achieved in Q3 2019, with a decline of 2.4% year-on-year (YoY) in home prices, says Knight Frank. However, the ranking of India compared to the previous quarter (Q2 2020) remains unchanged at 54th spot amongst the 56 countries and territories tracked in the Q3 2020 index.
According to its Global House Price Index Q3 2020 report, Ireland, Spain, India and Hong Kong are amongst those countries and territories witnessing the weakest price growth year-on-year.
It may be noted that the Global House Price Index tracks the movement in mainstream residential prices across 56 countries and territories worldwide using official statistics. In the 12-month percentage change for the period Q3 2019 – Q3 2020, Turkey continues to lead the index for the third consecutive quarter with annual price growth of 27%. However, in real terms once inflation of 14% is deducted, annual price growth sits closer to 13%. Overseas interest from the Middle East and a buoyant economy are bolstering prices, GDP increased 16% in Q3 compared to Q2. New Zealand (15%) jumped from 11th to second place between Q2 and Q3 as the country saw demand increase post-lockdown. Residential sales totalled 8,618 in Q3 2020, up 41% from 6,112 a year earlier. Morocco was the weakest-performing territory in Q3 2020, with home prices falling to 3.3% YoY.
Knight Frank India’s recent report titled ‘India Real Estate Update (July – September 2020)’ – which analyses the residential and office market performances across eight major cities for the Q3 2020 period – estimates that home sales volume jumped by 2.5 times to 33,403 units in Q3 2020 compared to 9,632 in Q2 2020. New residential unit launches increased by 4.5 times to 31,106 units in Q3 2020, compared to 5,584 units in the previous quarter.
Mainstream residential prices across 56 countries and territories worldwide saw a slight price correction, which stood at an annual rate change of 4.5% on average, compared to Q2 2020 at 4.7%. According to the report, 16% of the surveyed global countries and territories registered a decline in yearly price growth. In Q2 2020, many housing markets remained frozen and saw a sharp rebound in sales and prices in Q3 2020, including New Zealand, UK and the US, while others witnessed only a marginal impact on pricing including China, France and Germany.
Commenting on the same, Shishir Baijal, Chairman & Managing Director, Knight Frank India, said, “In order to combat the adverse economic implications of the pandemic, real estate developers started innovating their marketing strategies which included financial benefits, discount, and easy payment options to attract buyers. While the overall real estate sector dynamics continue to remain strained, there has been a meaningful improvement in sales in Q3 2020. Home loan rates at a multi-decade low of sub 7%, fall in residential prices, aggressive marketing of ready inventory and indirect discounts to the buyers – have helped move the demand needle in Q3 2020. Going forward, though the economic fundamentals continue to remain strong, economic recovery is faster than expected. The housing trend remains strong and is expected to continue in the first quarter of 2021.”