The reports state that rural areas are registering a flourish in the housing market segment
With the emergence of rental markets beyond urban hubs and consumption patterns undergoing a shift, the new consumer price index (CPI) series will measure rural housing inflation, as per the media reports.
As rural areas do not boast a significant number of rented homes, housing is measured as a part of urban inflation at present. The reports added that led by a preference shift and increase in mobility for work, rural areas are registering a flourish in the housing market segment. People are now spending on house rent in rural areas as observed in consumption surveys.
The reports added that along with a new series for the index of industrial production and gross domestic product, a new CPI series with an updated base year is slated to take effect from February 2026. With the household consumption expenditure survey 2022-23 being used to prepare the new series, the reports highlighted that 2024 will be taken as the base year for the new CPI series.
Showing evidence for the inclusion of rural housing inflation, the HCES 2022-23 revealed that the average monthly per capita expenditure (MPCE) on housing in rural areas registered an increase of around five times to Rs 30 from Rs 7 spent during the 2011-12 HCE survey. When it comes to share of total expenditure, such expense’s share doubled to 0.8 per cent from 0.4 per cent during the stated period, as per the reports.
On the other hand, the average monthly per capita expenditure on housing in urban areas also marked an increase as it rose to Rs 423 in 2022-23 as compared to Rs 160 in 2011-12. The reports also highlighted that the share of housing expense in urban areas against the total expenditure stood at 6.6 per cent in 2022-23.
