Real Estate Market News: Property Rates Declining in This Major Indian City — Know Why
Real Estate Market News: Property Rates Declining in This Major Indian City — Know Why
While most major cities in India are witnessing a steady surge in property prices, one city is showing a surprising trend in the opposite direction. Amid ongoing growth driven by rising demand, urbanisation, and a booming luxury segment, Pune has emerged as the only major Indian city where residential property rates have actually dropped in the past year.
According to a recent report by Housing.com in collaboration with the Indian School of Business (ISB), Pune’s Housing Price Index (HPI) declined by 4 points year-on-year. This downturn comes at a time when home prices in other major urban centres like Bengaluru and Hyderabad continue to climb, thanks largely to the strength of their tech-driven economies.
Why Are Prices Dropping in Pune?
Experts attribute this unique dip in Pune’s property market to growing uncertainty in the IT sector—a key industry in the city. With ongoing concerns about global economic conditions, especially the threat of a slowdown in the U.S. economy, homebuyers in Pune’s IT corridors are becoming more cautious about making large investments, such as purchasing a new home.
The report suggests that this hesitation has directly impacted sales volume, which in turn has slowed price growth. As a result, Pune stands out in the national real estate landscape for experiencing negative price movement, while most other cities are on an upward trajectory.
Not All Segments Are Affected
Interestingly, despite the overall decline in pricing trends, the demand for larger and premium homes in Pune remains relatively strong. Many homebuyers with higher budgets are still actively investing in spacious or luxury properties, which indicates that the dip is more prominent in the mid-range and affordable housing segments.
What’s Happening Elsewhere?
In contrast, cities like Bangalore and Hyderabad have seen significant price hikes, supported by a robust and expanding tech workforce. These cities continue to attract a younger, high-earning population that fuels the residential real estate market—especially in the premium and high-rise apartment categories.
Meanwhile, nationwide data from the 1 Finance Property Total Return Index reveals that property prices across major Indian cities have grown by an impressive 48% over the past five years, further highlighting how Pune’s recent dip is an outlier in an otherwise bullish market.
Pune’s current property price dip isn’t necessarily a sign of a market crash but rather a temporary correction, influenced by macroeconomic uncertainties and buyer sentiment. While the city remains one of India’s key real estate hubs, especially for tech professionals, the coming quarters will be crucial in determining whether this trend persists—or if Pune follows the national trend of rising real estate prices once again.
