House Price Index sees 3.1% YoY increase in Q4 FY25: RBI
The Reserve Bank of India (RBI) has released the All-India House Price Index (HPI) for the fourth quarter (Q4) of Financial Year (FY) 2025, which shows a year-on-year (YoY) increase of 3.1%. This is slightly lower than the 3.1% increase recorded in the previous quarter (October-December 2024) and a decline from the 4.1% increase seen in the same quarter last year (January-March 2024).
The HPI is a key indicator of the real estate market, providing insights into the movement of house prices across various cities in India. The RBI’s data is based on a sample of 12 cities, which includes Bengaluru, Chennai, Delhi, Jaipur, Kochi, Kolkata, Mumbai, Nagpur, Pune, Surat, Thiruvananthapuram, and Hyderabad.
The cities that recorded the highest YoY increase in house prices during Q4 FY25 are Kolkata, which saw a whopping 8.8% increase, followed by Bengaluru, Jaipur, and Chennai, which recorded increases of 4.5%, 4.2%, and 3.3%, respectively. On the other hand, Kochi was the only city to record a decline in house prices, with a YoY decrease of 2.3%.
The sequential rise in house prices in Bengaluru, Jaipur, Kolkata, and Chennai is a significant development, as it indicates a rebound in the real estate market in these cities. Bengaluru, in particular, has been a major hub for the IT industry, and the city’s housing market has been impacted by the pandemic. The increase in house prices in Bengaluru could be a sign that the city’s economy is recovering from the pandemic-induced downturn.
The RBI’s data also shows that the house price index has been steadily increasing over the past few quarters, except for Kochi, which has seen a decline in house prices. The index has increased by 10.1% over the past year, indicating a moderate pace of growth in the real estate market.
The increase in house prices could be attributed to various factors, including the government’s efforts to boost the economy, the ongoing vaccination drive, and the decline in COVID-19 cases. Additionally, the RBI’s decision to keep interest rates low has made borrowing cheaper, which has led to an increase in demand for housing.
However, there are also concerns about the sustainability of the real estate market. The RBI’s data shows that the house price index has increased by 10.1% over the past year, which is relatively low compared to the pre-pandemic levels. This could be a sign that the real estate market is still recovering from the pandemic-induced downturn.
Furthermore, the increase in house prices could also lead to concerns about affordability, particularly for low- and middle-income families. The RBI’s data shows that the average house price in India is around Rs 3,500 per square foot, which is still unaffordable for many Indians.
In conclusion, the RBI’s data on the All-India House Price Index for Q4 FY25 shows a moderate pace of growth in the real estate market, with a YoY increase of 3.1%. The cities of Kolkata, Bengaluru, Jaipur, and Chennai recorded sequential rises in house prices, while Kochi saw a decline. The increase in house prices could be attributed to various factors, including the government’s efforts to boost the economy and the RBI’s decision to keep interest rates low. However, there are also concerns about the sustainability of the real estate market and affordability issues.
Source:
https://www.ptinews.com/story/business/House-price-index-rises-3-1-pc-in-Q4-FY25–RBI-data/2661699
