What has been the change in the property market within the last 2-3 years?” asks Raghu Yadav. He continues, “I keep following the appreciation/ depreciation/stabilization in the property prices on a quarterly basis, but what impact does it have on me? Do these minor fluctuations bring about any change? I feel that the property prices have remained almost the same for the past 2-3 years.”
Do you also feel the same? Let us see what have been the changes in the past 3 years and how have these changes impacted your city area or locality.
Everyone has an opinion on whether it is better to rent or buy a home in the prevailing market conditions. Often these opinions are based on personal circumstances and often what is better for one person may not be the best solution for someone else.
As the property market does not see changes at a rapid pace, the latest Makaan.com Buy vs. Rent Index (MBRI) works out a comparison between the changes that happened from OND 2011 to OND 2013. What comes out clearly according to the report is that the key Indian cities, including Mumbai, Delhi, Bangalore, Ahmedabad, Pune and Chennai have seen a significant shift in sentiment towards renting in the past three years; another fact highlighted is that although the rental property prices in these cities seem attractive and affordable at present, it is not that purchasing a property has always remained outside the reach of the common man. Let’s retrace the index from 2011 onwards:
Makaan.com Buy vs. Rent Index (MBRI) for top Indian cities / areas (Oct-Dec. 2011- Oct-Dec. 2013)
The national MBRI data for OND 2013 reflects that renting is preferred over buying and speculating. Overall a lower MBRI (under or equal to 20) indicates a preference for Buying vs. Renting and a higher MBRI (over 25) indicates a preference for Renting over Buying. MBRI of 21 to 25 is a Neutral zone where the person can take a decision based on his liquidity position. On analyzing the MBRI for OND 2013 for 31 sub-cities in India (see table), it can be observed that cities like Mumbai, Pune, Delhi, Chennai and Ahmedabad are preferred for Renting whereas Bangalore and Hyderabad are in the Neutral zone. In fact there is no city in India where buying a property is advisable over renting. However, we must clarify that there would be pockets within these