Luxury home prices have surged by a substantial 24% over the past five years across India’s leading seven cities, surpassing the growth rate witnessed in the affordable housing sector. The data, presented by Anarock Research, highlights the evolving preferences in housing choices, influenced in part by the pandemic, resulting in heightened demand for luxury residences and consequently propelling prices within this segment.
In 2018, the average prices of luxury homes in the top 7 cities stood at approximately ₹12,400 per square foot. Fast forward to 2023, and these prices have ascended to around ₹15,350 per square foot.
Among these cities, Hyderabad has emerged as the front-runner in luxury home price growth, experiencing an astonishing 42% surge in average prices, which escalated from ₹7,450 per square foot in 2018. Bengaluru and the Mumbai Metropolitan Region (MMR) closely follow, each recording a commendable 27% appreciation.
Bengaluru’s luxury housing sector has witnessed an ascent from ₹10,210 per square foot in 2018 to ₹12,970 per square foot in the current year. Similarly, MMR’s luxury homes observed a surge, with prices rising from ₹23,119 per square foot to ₹29,260 per square foot over the same period.
In stark contrast, the affordable housing category, encompassing homes priced below ₹40 lakh, witnessed a comparatively modest price growth of 15% during the same time frame. Across the top 7 cities, the average price in this segment has risen from ₹3,750 per square foot in 2018 to ₹4,310 per square foot in 2023.
Notably, within the affordable housing category, the National Capital Region (NCR) experienced the most significant surge, with average prices increasing by 19% to ₹3,700 per square foot in the first half of 2023. Following closely, Hyderabad recorded a 16% appreciation, with prices reaching ₹4,000 per square foot in H1 2023.
“The surge in sales coupled with an adequate supply pipeline has led to substantial price appreciation in the luxury housing segment. This 24% increase in value over five years is particularly noteworthy considering the relatively stagnant prices observed in earlier years. Conversely, the affordable housing sector, which had shown momentum before the pandemic, witnessed a dip in sales, subsequently impacting its price growth.”
Anuj Puri, Chairman of ANAROCK Group
The report underlines the shifting dynamics of the real estate market, where evolving consumer preferences play a pivotal role in shaping price trends across various housing categories.