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Surge in housing prices reflects the growth of real estate in 2024

The housing market in India has experienced a significant boost of 20 percent in prices over the last two years. This growth can be attributed to several factors, including attractive interest rates, a positive economic outlook, and an increase in confidence among homebuyers. The luxury and mid-segment sectors saw particularly strong demand, driven by high-value transactions, robust rental yields, and the potential for asset value appreciation in 2023 and is set to continue in 2024, providing a positive outlook for the future.

According to the Colliers-Liases Foras housing index tracker, metropolitan areas such as Delhi-NCR have experienced an unprecedented surge in average housing prices, increasing by up to 30 percent in 2023 compared to 2021.

Mr. Devender Aggarwal, Co-Founder & Joint Managing Director, Signature Global (India) Ltd.  Said, “Gurugram real estate market is experiencing a surge in demand for mid-income and premium homes, driven by the young professionals and nuclear families seeking an aspirational yet luxurious lifestyle. Factors such as favorable policy measures, evolving consumer preferences and renewed investor confidence are responsible for the increase in demand for residential properties. The prospective homebuyers are attracted to Delhi-NCR due to excellent connectivity with key hotspots or micro markets are New Gurugram, Dwarka Expressway, and Southern Peripheral Road and Sector 71, sector 37 D, sector 84, sector 93 sector 92 are the potential location for end users and investors both. Additionally, the changing lifestyle preferences and evolving work-from-home dynamics have fueled the demand for spacious and well-equipped residential markets. As per the industry reports, average housing prices jumped 9% year over year across India in Q4, which crafts a positive outlook for real estate business in new fiscal as well.

This surge has been particularly prominent in luxury and mid-segment housing, propelled by high-property sales, robust rental yields, and value appreciation. Notably in Delhi-NCR, which witnessed a remarkable decline of 19 percent during the period from 2021 to 2023. This decline in unsold inventory clearly indicates the buoyancy of the housing market and reflects strong market momentum.

Aman Trehan, Executive Director, Trehan Iris, said, the real estate sector has witnessed significant expansion due to a surge in housing prices. The residential real estate sector experienced a significant surge in Q3 FY24, with a year-on-year increase of 26%, according to the recent analysis by Kotak Institutional Equities. Additionally, the NCR region witnessed a healthy improvement in sales activity during the same period, with a 12% YoY rise in sales. Gurugram, in particular, observed a substantial increase of 57% due to robust pricing momentum. Furthermore, due to significant returns, a growing economy, well-connected infrastructure, and other amenities, the demand for housing has intensified, leading to a rise in prices, and highlighting the importance of the real estate sector.  Moreover, the increased demand and exponential surge in property transactions have instilled confidence among buyers, highlighting the significance of property ownership as a cornerstone of sustained growth and economic stability. Besides, with several launches planned for Q4FY24 / FY25, the sales momentum is expected to sustain in the foreseeable future.

The increase in housing prices can be attributed to various factors. One significant reason is the favourable interest rate environment. When interest rates are low, it becomes easier for individuals to obtain home loans, making homeownership more accessible and cost-effective. Consequently, the demand for residential properties increases as more prospective buyers are motivated to enter the market. This heightened demand exerts upward pressure on housing prices, leading to their escalation. In essence, the chemistry between low mortgage rates and increased demand creates a cycle wherein housing prices rise.

Parvinder Singh, CEO, Trident Realty says “The surge in housing prices is a clear reflection of the strong growth and development of the real estate industry in Delhi NCR. This trend is primarily driven by urbanization, infrastructure development, and rising disposable incomes, pointing towards a promising future for the real estate sector in the region. According to market reports, with housing prices continuing to rise due to strong market momentum, Delhi NCR’s real estate market is expected to expand further, providing abundant investment and development opportunities. The positive economic outlook and increasing demand for properties in the mid and luxury segments are key factors driving this growth, positioning Delhi NCR as a thriving hub for real estate development in the years ahead.”

Additionally, a positive economic outlook has instilled confidence among consumers, encouraging them to invest in real estate as a lucrative asset class. Moreover, growing market matrix, coupled with government policies aimed at boosting the housing sector, have further fuelled growth in housing prices.

Mr. Santosh Agarwal, Executive Director and CFO, Alphacorp, said “The surge in housing prices, escalating nearly 20% from 2021 to 2023, signifies a rapid acceleration in India’s property market. Intensified competition among buyers, driven by imbalances in demand-supply dynamics exacerbated by urbanization and migration trends, underlies this growth. Bengaluru, Delhi NCR, and Kolkata saw an unprecedented surge of up to 30% in average housing prices by 2023, per the Colliers-Liases Foras housing index tracker. Expectations for sustained growth remain high, with visible upcoming projects by established developers due to an unchanged repo rate, increase in income levels and positive market sentiments. In 2023, over 3,90,419 units were launched, a 7% year-on-year increase, indicating market expansion. Projections for 2024 anticipate a surge in housing demand and supply not only in major cities but also in Tier II and III regions, which also forms a significant part of our portfolio, hence shaping a dynamic landscape.

With housing prices continuing to reflect strong market momentum and a positive economic outlook, the real estate sector is all set for a future of sustained expansion. Buoyed by the nation’s projected status as one of the world’s fastest-growing economies, the sector is forecast to experience significant growth, potentially reaching a staggering $5.8 trillion by 2047. This optimistic outlook is further reinforced by current affordability levels and the expectation of moderating inflation and interest rates, creating a fertile ground for continued market expansion. 

Ashish Sharma-AVP Operations, Brahma Group, said, “Over the past few years, the Indian real estate market has experienced a significant surge in housing prices in major cities, reflecting the changing dynamics of supply and demand. This upward trend reflects a confluence of factors, including increased demand driven by population growth, low mortgage rates, and a buoyant economy. Besides, as cities evolve into vibrant hubs of commerce and culture, the attraction of urban living intensifies, propelling a rise in property values. This surge in prices not only symbolizes financial prosperity but also highlights the enduring appeal and resilience of real estate as a fundamental driver of growth. Moreover, the Delhi NCR region witnessed an annual 9% surge in housing prices, leading to a steady and robust demand for housing. However, the surge in housing prices serves as a testament to the robust expansion of the real estate sector in 2024.” 

Furthermore, with the ongoing evolution of market dynamics and emerging trends, the real estate sector is witnessing a major shift in consumer preferences and demand patterns. The growing popularity of integrated townships, sustainable housing developments, and technologically advanced smart homes reflects evolving consumer preferences and demands.

Therefore, rising housing prices present opportunities for investors and homeowners. With suitable policies, the real estate sector can maintain its upward trajectory, contributing to India’s growth. As investors capitalize on returns, homeowners benefit from appreciation. Moreover, sustained growth in the real estate sector maintains employment opportunities, infrastructure development, and overall economic prosperity.


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