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Kochi, Bangalore and Patna witnessed significant corrections in prices of homes during the January-March quarter

Chennai, Delhi and Faridabad saw steep rise in residential property prices while Kochi, Bangalore and Patna witnessed significant corrections during the January-March quarter of 2012, compared with the previous quarter a year ago.

Prices of residential properties showed an increasing trend in five cities and a decline in 10 cities, shows the residex report of National Housing Bank’s (NHB). The index saw moderation/stable property prices in a majority of the cities over the previous quarter, except for Jaipur and Hyderabad, where it witnessed significant increases.

The index indicates that Chennai, Delhi and Faridabad registered a growth of 39.45 per cent, 33.33 per cent and 31.52 per cent, respectively, during January-March 2012 period, over the corresponding period last year. Kochi, Kolkata and Ahmedabad have witnessed a negative growth of 16.28 per cent, 9.48 per cent and 0.61 per cent, respectively.

Over a longer duration of four years, the residential property index, whose January-March data was released by the National Housing Bank on Monday, indicated housing prices in Chennai have gone up around 192.31 per cent during January-March 2012 period, compared with the January-June 2008 period. Faridabad has witnessed a rise of 117 per cent in residential property prices during the same period. This means a housing property bought in Chennai four years back for Rs 10 lakh, will be around Rs 30 lakh at present.

Southern cities of Kochi and Hyderabad have, however, experienced a negative growth in housing prices in the past four years. While the prices of homes have gone down 32.08 per cent in Kochi, Hyderabad has shown a decline of 10.42 per cent.

“In Chennai, property prices have gone up primarily because of the resurgence of the industrial sector and high demand of land. Similarly, a lot of infrastructure development has taken place in Faridabad, including roads and plans to have Metro train connectivity in the past four years. A declining trend in housing prices in some other cities may be attributed to delay in decision-making by the industrial community in their investment decision,” said RV Verma, CMD of National Housing Bank (NHB).

Other cities like Pune, Mumbai and Kolkata have also registered a trend of rising home prices with 79.21 per cent, 69.64 per cent and 67.54 growth, respectively. Housing prices in Delhi have gone up by around 35.48 per cent over the past four years.