The Knight Frank Global House Price Index Q3 2019 released on Friday ranked India at 47th spot among 56 countries tracked in terms of appreciation in residential real estate prices with a marginal 0.6 per cent year-on-year rise in home prices.India stood at 11th position in the previous edition of the report with a 7.7 per cent year-on-year rise in home prices.
Slow sales, high inventory and lack of liquidity with developers have restricted rise in home prices, said the leading international property consultancy.
Also, regulations imposed by the government to ensure accountability in the system like Real Estate (Regulations and Development) Act 2016, Goods and Services Tax Act, and Benami Transactions (Prohibition) Amendment Act 2016 have laid the foundation for a healthy end-user market.
The Global House Price Index tracks the movement in mainstream residential prices across 56 countries and territories worldwide using official statistics. Hungary leads the index this quarter with 15.4 per cent annual price growth, followed by Luxembourg at 11.4 per cent and Croatia at 10.4 per cent.
Prices across 56 countries and territories worldwide rose at an annual rate of 3.7 per cent on average, which marks the index’s slowest rate of growth for over six years.
Majority of the countries and territories registered a static or positive growth in the year to September 2019.
“During the last four years, the growth in residential prices in most of the top eight cities of India has been below retail inflation growth, which has helped in keeping the end-user interested,” said Shishir Baijal, Chairman and Managing Director of Knight Frank India.
“Liquidity crunch, high inventory overhang and overall sluggishness in demand have played their part in rationalising home prices. Real estate developers are focusing on keeping the prices realistic, with right-sizing their products, which is helping in attracting end-users and improving buyers’ confidence,” he added.