Buying your own house is one of the most expensive deals in today’s time. If we talk about metro cities, then the property prices here have reached the sky and in the last four years, there has been a huge jump in their prices. According to a report, from the year 2020 to 2024, property prices in some major cities of the country have increased at a Compound Annual Growth Rate or CAGR of 9.3%, while household income has grown at a slow rate of 5.4%. Let us know in which cities the prices are continuously increasing and where there will be profit on investment…
Most affordable property in these cities
According to a report by Magicbricks, Chennai, Ahmedabad and Kolkata top the list of most affordable cities in the year 2024. These cities have the lowest price to income (P/I) ratio among the top-10 property markets in India. This process is applied for valuation in real estate and if we understand its meaning, then high PI means that the property price is high, while low PI means that it is cheap. In contrast, Delhi and Mumbai have seen a strong jump in prices and they top the list of least affordable cities.
Buying property in Delhi-Mumbai is expensive
Mumbai Metropolitan Region (MMR) and the capital city of Delhi (Delhi) are reported to be the least affordable, where property prices are rising much faster than household income. From 2020 to 2024, property prices in some of the major cities of the country have grown at a CAGR of 9.3%, while household income has grown at a slower rate of 5.4%. Not only this, the average P/I ratio here has increased from 6.6 in 2020 to 7.5 in 2024, which is well above the benchmark of 5. If we talk about Mumbai and Delhi, then here this ratio is 14.3 and 10.1 respectively, which indicates higher costs in these areas.
There is a strong return on renting out property here
In terms of rental income on property in top cities of India, in 2023, rents increased by more than 30% year-on-year and this pace continued in 2024 as well. According to a report published on Business Today, India’s Silicon Valley Bengaluru is at the forefront in this case due to its strong rental yield. Property rents have increased by more than 40% in some areas of Bengaluru. The average monthly rent of a 2 BHK apartment in Sarjapur Road increased from ₹ 31,600 in Q4 2023 to ₹ 34,000 in Q1 2024. Similarly, Whitefield saw an increase in rent from ₹ 30,200 to ₹ 32,500 during the same period.
Fare increased from Noida-Gurugram to Mumbai
This figure of rental yield is not limited to Bengaluru only, but it has also increased in cities like Mumbai and Gurugram, with Mumbai increasing by 4.15% and Gurugram by 4.1% during the same period. It is clear from this that after the Corona epidemic, once again there has been a surge in demand especially in IT-centric cities and good income is being generated by renting out property. A sharp increase in rent has also been observed in other cities. Rent in Sector 150 of Noida and Dwarka in Delhi has increased by 9% and 6% respectively, while in Chembur and Mulund of Mumbai it has increased by 4%, in Rajarhat of Kolkata it has increased marginally by 3% and in Chennai and Hyderabad it has increased by 4% and 5% respectively.
Source (PTI) (NDTV) (HINDUSTANTIMES)