House Price Index (HPI) India

The All-India House Price Index grew by 5.7% YoY in Q2FY19.

Published by the Reserve Bank of India (RBI) quarterly. Updated until the Jul-Sep 2018 quarter. (Published on February 6th, 2019)

Recent Data Trend

Housing prices grew by 5.7% year on year (YoY) in Jul-Sep'18 (Q2FY19) at the all-India level as compared to the year-ago period. The all-India House Price Index (HPI) stood at 5.3% YoY in the last Quarter.

Seven out of the ten major cities recorded a slowdown in average house price inflation in Q2FY19. The house price inflation in Kanpur, with an exception contracted by 3% YoY in Q2FY19, while Delhi (2% YoY), Kolkata (3.1% YoY) and Mumbai (3.6% YoY) have over a year low inflation in the housing segment. On the contrary, Chennai has recorded a seven-quarter high housing inflation growth of 11.8% YoY, as against negative housing inflation of 7% YoY in last the quarter.

The real estate sector, which got impacted by the subsequent implementation of demonetization and GST, has been facing a multi-year demand slowdown. Acknowledging the downtrend in the real estate sector, the Modi government came up with many income tax sops in its interim budget for FY20. The government has proposed no. of tax benefits for the consumers and players in the real estate sector in the affordable housing category in the interim budget, which may boost the property sales across the country.

The government in its interim budget for FY20 has proposed to exempt income tax charge on notional rent on a second self-occupied house. This may induce many individuals to purchase more than one house and hence, will drive up the sales in the real estate sector. In addition, the budget has also proposed to extend a tax rebate on the development of affordable housing till the next fiscal. Which will possibly boost the investors' activity in the real estate sector.

Though the government's attempt to address the issues in the housing sector, is mainly a crowd-pleasing electoral pitch, to some extent this may help the housing industry to recover.


Brief Overview

The House Price Index (HPI) (Base: 2010-11=100) is compiled quarterly by the Reserve Bank of India (RBI) for ten major cities, viz, Mumbai Delhi, Chennai, Kolkata, Bengaluru, Lucknow, Ahmedabad, Jaipur, Kanpur, and Kochi. Based on these city indices, an average house price index representing all-India house price movement is also compiled. These indices are based on the official data of property price transactions collected from registration authorities of respective state governments. The HPI is a weighted average Laspeyres index based on transaction price, where transactions are stratified into three categories, viz., small, medium and large houses and in different geographical wards/zones. Further, the city-wise indices are averaged using the population proportion to total as the weight to obtain an all-India index. For further information on methodology and computation of HPI click here.

For more information please visit the official website.

Next Release Date: To be decided

City-wise Housing Price Index-NHB Residex

Note: The index series is on the base 2012-13=100. To know more about NHB Residex, click here.