Home prices in Mumbai, India’s most expensive real estate market, rose to a record last quarter even as sales slowed, according to Liases Foras Real Estate Rating & Research Pvt.
Prices in Mumbai increased 2.9 percent to 11,626 rupees ($215) a square foot in the three months to March 31, the data showed, while sales climbed 1 percent, from 5.7 percent in the December quarter, to 10.45 million square feet. Total housing stock in the city advanced to a record 150 million square feet as of March 31, the property research company said.
“Price increases were persistent across cities,” Pankaj Kapoor, founder of Liases Foras, said in a telephone interview from Mumbai yesterday. “The decline in Mumbai prices in the December quarter, which hinted towards a further correction, could not be sustained.” Mumbai prices slid 1 percent in the December quarter.
The Reserve Bank of India cut funding costs in March for a second time this year to 7.5 percent. The central bank, which is scheduled to meet on May 3, has said lingering inflation reduces the scope for further cuts.
Unsold homes in Mumbai rose 3.7 percent to 139.33 million square feet, while in Delhi and areas surrounding the capital city they increased 0.1 percent to 262.67 million square feet, the data showed.
Three of six cities Liases Foras tracks posted a decline in sales in the March quarter from the previous three months. The southern city of Hyderabad posted the largest drop at 46 percent as prices climbed 3.5 percent, while Bangalore, also in the south, had the second-biggest sales decline, according to the data. Prices in Bangalore rose 6.4 percent to a record 5,004 rupees a square foot, it showed.