Showing a mixed trend, housing prices in 11 cities, including Bangalore and Kolkata, declined by up to 5 per cent in July-September, while rates in nine other places increased by up to 10 per cent, according to National Housing Bank (NHB).
Kochi saw the highest price rise of 10.1 per cent, followed by Jaipur with 9 per cent during the second quarter of this fiscal compared with the previous quarter. In Delhi-NCR, Mumbai and Chennai, prices rose by 3.8 per cent, 0.5 per cent and 1 per cent, respectively, NHB data showed.
NHB RESIDEX tracks the movement in prices of residential properties on a quarterly basis. It covers 20 cities. From January next year, it plans to cover 6 more cities. "Overall, there is a price correction. Even in nine cities where prices have gone up, there will be net decline if we factor in the rise in input cost and inflation," NHB Chairman and Managing Director R V Verma told PTI.
Asked about falling prices, he said, "Builders cannot sustain at current prices because of oversupply. So, they are decreasing the price to clear inventory and boost sales."
Housing demand has been affected for last few years due to high interest rates on home loans. "The movement in prices of residential properties has shown marginally declining trend in eleven cities, ranging from -0.4 per cent in Faridabad to -4.8 per cent in Surat, and rise in nine cities ranging from 0.5 per cent in Mumbai to 10.1 per cent in Kochi during July-September, 2012 in comparison to the previous quarter April-June 2012," NHB said.
Ahmedabad saw 3 per cent rise, Bhubaneshwar 2.3 per cent, Lucknow 2.2 per cent, Chennai 0.8 per cent, Pune 0.7 per cent.
Prices fell the maximum in Surat (-4.8 per cent), followed by Indore at -3.54 per cent, Kolkata -2.4 per cent, Vijayawada -2.4 per cent, Patna -1.8 per cent, Ludhiana -1.7 per cent, Bangalore -1.7 per cent, Hyderabad -1.3 per cent, Guwahati -0.7 per cent, Bhopal -0.5 per cent and Faridabad -0.4 per cent.
On the overall trend, NHB said that prices have started to decline in some smaller towns and the increase in other cities is mostly marginal, barring Kochi and Jaipur. "There is some signs of convergence of prices around this level across the 20 cities," it added.