India’s Soaring Property Prices: Are They Sustainable or Headed for a Bubble? Startup Founder Explains
India’s Soaring Property Prices: Are They Sustainable or Headed for a Bubble? Startup Founder Explains
The Indian real estate market has been witnessing a continuous surge in property prices, raising concerns about their long-term sustainability. In a recent discussion, a startup founder shared key insights into the factors fueling this trend and its implications for prospective buyers and investors.
Akshat Shrivastava, a financial influencer and founder of Wisdom Hatch, believes that housing prices in India are unlikely to decrease anytime soon. In a post on X, he attributed this to the dominance of private developers in the market, who control pricing strategies.
Shrivastava pointed out a shift in homeownership preferences. Previously, individuals purchased land and built homes independently, but now, ready-made houses from private developers are in high demand. He emphasized that these developers are not keen on offering affordable pricing.
Even during global economic slowdowns, developers employ tactics to keep prices elevated. Shrivastava noted that they often delay projects or handovers for extended periods. If such strategies are ineffective, they opt to sell properties to large private equity firms instead of individual buyers, ensuring market prices remain high.
He also highlighted a stark contrast between India’s GDP per capita and housing costs. While India’s GDP per capita stands at $2,200—nearly 40 times lower than that of the US—property prices in India are surpassing those in many leading American cities. He questioned whether this price surge would continue or if the market would eventually correct itself.
As of early 2025, property rates have escalated significantly in key metropolitan areas. Mumbai remains the most expensive city, with prices ranging between ₹15,000 and ₹25,000 per square foot. Limited land availability, major infrastructure projects like the Mumbai Coastal Road, and high demand from affluent buyers, including Bollywood celebrities, have further driven up prices.
The Delhi NCR region has recorded an impressive 49% year-on-year price increase, largely propelled by developments such as the Noida International Airport and a rising demand for luxury housing. Bengaluru and Hyderabad are also witnessing notable price growth due to their booming IT industries, with Bengaluru’s average property rates ranging from ₹7,000 to ₹12,000 per square foot.
Emerging locations on the outskirts, including Dwarka Expressway in NCR and Panvel in the Mumbai Metropolitan Region (MMR), have experienced substantial appreciation due to improved connectivity and relatively lower costs. The luxury housing segment remains strong across major cities, while the availability of affordable homes continues to decline, further escalating prices.
Despite the relentless upward trajectory of property rates, Shrivastava’s analysis underscores a critical reality: with private developers exerting significant control over the market, a decrease in housing prices appears unlikely in the near future.
