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PRICE INDEX - REPORT AND INDICES
News:
RBI's home price index
increases across India despite rate hikes
What's
in the news?
●
Home prices in the country have gone up -
albeit at a slower pace - if data collected by the Reserve Bank of India is any
indication, signalling that higher interest rates have not made much impact in
the sector till now.
Key
takeaways:
●
The RBI’s
All India Home Price Index (HPI) recorded a 2.79 percent growth (year-on-year) to 302 in the third quarter
(ended December) of 2022-23 as compared with 293.8 when it showed a 3.1 percent growth a year ago despite the
rise in interest rates.
Home
Price Index:
●
The RBI data is based on transaction-level
data received from the registration authorities in ten major cities - Ahmedabad, Bengaluru, Chennai, Delhi, Jaipur,
Kanpur, Kochi, Kolkata, Lucknow and Mumbai.
Trends:
●
The RBI hiked the Repo rate by 250 basis
points (bps) to 6.50 percent since May 2022 to rein in inflation.
●
Home
loan rates of banks and finance companies have gone up
as most of the loans are now linked to an external benchmark rate like the Repo
rate.
●
The premium and luxury segment, in
particular, has largely remained unaffected with the rising interest rates as
customers are looking to invest in properties which provide them with a greater
sense of living and offer them better returns as an investment.