The Housing Price Index (HPI) is a crucial economic indicator released by the Reserve Bank of India (RBI). It tracks fluctuations in residential property prices across major cities in India. This index provides valuable insights into real estate trends, economic stability, and housing affordability.
The HPI measures the movement of residential property prices over time. Compiled by the RBI, it utilizes transaction-level data sourced from banks and financial institutions across selected cities in India.
The HPI serves several important functions:
The calculation of the HPI relies on data gathered from property registrations. The index reflects the weighted average price of residential properties in selected cities, using 2010-11 as the base year for comparison.
The RBI currently includes ten major cities for HPI calculation:
The RBI publishes the HPI quarterly, offering insights into price movements for individual cities as well as a composite index for all of India.
For investors, the HPI provides vital insights into real estate market trends, facilitating informed investment choices. Potential homebuyers can gauge affordability and price trends of residential properties across different cities.
Recent reports suggest that residential property prices are rising in many areas due to urbanization, population growth, and increasing housing demand. However, several regions display corrections stemming from oversupply or macroeconomic influences.
The HPI is an indispensable tool for the RBI and government agencies to monitor housing inflation and maintain financial stability. It informs policies related to affordable housing, real estate development, and urban planning.
While the HPI reflects historical data and current trends, it does not directly predict future price movements. However, when analyzed alongside other economic indicators, it lays the groundwork for forecasting trends in the real estate market.
Q1. What is the Housing Price Index (HPI)?
Answer: The Housing Price Index measures the changes in residential property prices over time, compiled by the RBI using transaction data from banks in India.
Q2. Why is the HPI significant?
Answer: The HPI helps policymakers assess the real estate market, understand housing affordability, and analyze economic stability, impacting inflation and investments.
Q3. How is the HPI calculated?
Answer: The HPI is calculated using property registration data, reflecting the weighted average price of residential properties in specific cities with 2010-11 as the base year.
Q4. Which cities are included in the HPI?
Answer: The HPI covers ten major cities, including Mumbai, Delhi, Bengaluru, Chennai, and others, providing a comprehensive view of property price movements in India.
Q5. How often is the HPI published?
Answer: The RBI publishes the HPI quarterly, featuring data on price movements for individual cities and a composite index for the entire country.
Question 1: What does the Housing Price Index (HPI) measure?
A) Economic growth
B) Residential property prices
C) Government policies
D) Urban development
Correct Answer: B
Question 2: Which organization compiles the HPI in India?
A) Ministry of Housing
B) State Governments
C) Reserve Bank of India
D) National Statistical Office
Correct Answer: C
Question 3: What is the base year for the current HPI calculation?
A) 2010-11
B) 2015-16
C) 2020-21
D) 2005-06
Correct Answer: A
Question 4: How frequently is the HPI published?
A) Monthly
B) Biannually
C) Quarterly
D) Annually
Correct Answer: C
Question 5: Which city is NOT included in the current HPI calculation?
A) Mumbai
B) Delhi
C) Surat
D) Bengaluru
Correct Answer: C
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