Renters & Buyers Beware: Real Estate Prices to Surge Beyond Inflation
Big Relief: Housing Societies Cannot Charge Extra Fees from Owners Renting Out Flats Beyond Non-occupancy Charges. ( Representational Image )
Homebuyers and renters may face steep price hikes as property values and rental rates are expected to rise significantly. A recent Reuters poll, conducted between February 17 and March 4, suggests that housing prices will increase at a rate higher than inflation, making the market more challenging for first-time buyers and tenants.
The survey, which gathered insights from 14 real estate experts, predicts a 6.5% rise in home prices in 2025, followed by another 6.0% increase in 2026. This marks a sharp jump from the 4% rise in 2024, showing strong market momentum despite economic uncertainties.
A major factor behind the surge is the supply-demand gap. High-income property prices have nearly doubled in the past decade, while middle- and lower-income buyers struggle with affordability.
Stagnant wages, slow economic growth, and a lack of high-paying jobs have further reduced purchasing power, pushing more people into the rental market.
Experts predict that rental rates in major cities will increase by 7.0% to 10.0% in the next year, far exceeding projected inflation rates of 4.3% in 2025 and 4.4% in 2026. This will add financial strain on urban dwellers, particularly in metro areas where demand remains high.
The future of the property market depends on economic conditions, interest rates, and housing policies. While expected rate cuts by the Reserve Bank of India may offer some relief, strong demand and limited supply will likely keep prices rising.
