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Real Estate investments and Indian metropolitan cities

Shashank GuptaDec 01, 2014 | edited Dec 01, 2014 - by @ShashankGupta2

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India-a country with the seventh largest landmass on this globe, stands out proudly with a self-sufficient Real estate market. Alongside providing the people with new residential and commercial projects, the real estate market in India also proves to be a strong alternative for global investors to make millions. The real estate market is beginning to touch the zenith of development with 2,774 new cities and 51 million new projects launched in the past five years. In a country which has witnessed real estate investments worth 10.5 billion USD in the past 10 years, it is quite easy to find property that is worth investing and will pay high returns. Be it the numerous road projects, residential unit launches or commercial launches like retail malls, the real estate scenario is coming up with flying colors in every corner of the country.

Reasons for development

Reasons for the development of this sector can be found as listed below.

  • Sound political and economic fundamentals coupled with liberal policies by the government account for the foremost reasons for a steep growth this sector has witnessed.
  • Rising urbanization and new employment opportunities in various work spheres have substantiated the growth of this sector to a great extent.
  • A globalized approach by various companies/organizations has inspired various real estate firms in India to get inspired from projects across the globe.
  • Higher levels of income and introduction of better living conditions has provided a ripple effect to trigger real estate growth in various parts of the country.

 

Investment in Real estate

  • In a world where investing your wealth is as important as earning it, real estate stands as a perfect surrogate. Investment in Real estate may include investing your resources in ventures coming up with new projects, construction of built up residential units, commercial projects, city and regional level infrastructure facilities etc.
  • Investment of money in real estate not only offers the chances of high returns but also ensures capital appreciation in due time. With the latest tax reforms introduced by the finance ministry, real estate sector has proved to be one of the most lucrative sectors in the country's economy.
  • Allowance of a 100% Foreign direct investment in the sector and setting up of real estate mutual funds coupled with various fiscal measures taken up by the government has made the Indian real estate sector a promising investment option for people on the globe.
  • Cities like Mumbai, Bangalore, Delhi/NCR, Kolkata, Chennai, Hyderabad and Pune have seen immense growth in terms of real estate in the past 5 years.

According to a report by a reputed real estate website- 99acres.com trends in property have found to be of varying nature in seven major metropolitan cities.

 

Delhi/NCR

Delhi/NCR in the past 1 year has seen ups down in real estate investment. However, the area is experiencing stability at present with prices per sq. feet varying within an allowance of 1-2% in the first and second quarter of 2014.

Key areas in Delhi like Shahadra, Mehrauli and Chattarpur have seen an increase of 14%, 13% and 8% in property prices respectively in the past 2 months. Other areas like Mayur Vihar-I and Mayur Vihar II have seen an increase of 6% and 5% in the same period and stand out as stable investment options for investors.

Noida and Greater Noida: The quarter on quarter comparison present Sector-37 and Sector-44 as perfect investment options with a capital appreciation of 14% and 9% respectively. Sector-94 and sectors like Chi and Alpha-2 in Greater Noida too have stood up as promising investment alternatives with growth rates in capital value ranging between 8-10% in the past 3 months.

Mumbai

Mumbai

The real estate scenario in Mumbai has witnessed stability with prices per square foot going up by 2% in the past 3 months. The annual comparison shows capital appreciation of 7% in April-June 2014 over April-June 2013. Quarter on quarter comparison shows that Bhiwandi and KanjurMarg (West) are the areas with maximum price hike of 22% and 20% respectively while Mulund and Mulund East have seen a spike of 18% each in this period.

Bangalore

Properties in Bangalore have witnessed a price decline in the last few months. The quarter on quarter comparison shows prices going South by 5% in this time period. The area wise increase/decrease in price is listed below. Localities in North Bangalore like Hebbal and Hennur road have seen an increase of 11% and 9% in property value, while areas in vicinity of Hosur Road in south Bangalore have seen a price hike of 9% in contrast to a steep decline of 13% in areas outlining the district of Bommanahalli.

Chennai

Chennai has seen stability in capital prices for the past 3-4 months. On an average the prices per square foot have increased by 1% in major localities. Localities like Anna Nagar and Avadi have seen an increase of 9% and 7% in capital prices while region of Mogappair and Mogappair West have seen an increase of 6% in the same period.

Moreover, areas like Arcot Road and West Mambalamhave saw a decline of 8% and 7% in the second quarter of 2014 over the first one.

Hyderabad

The quarter on quarter comparison shows that average prices per square foot have remained stable while annual comparison shows an increase of 2% capital value in this time period.

Areas like Dilsukh Nagar and Madhapurare saw an increase of 13% and 8% while Begumpet and Nizampet have seen a spike of 2% in prices in the previous quarter. However, areas like Miyapur and Chandanagar have witnessed a decline of 2% each in the same period.

Pune

The city is witnessing an increase in capital prices in the last 3 months. The prices per square feet have increased by 2% in Q2-2014 (April-June 2014) as compared to Q1-2014 (Jan-March, 2014). Localities like Alandi Road and KatrajKondhwa Road has seen an increase of 9% and 8% while Hinjewadi and Fatima Nagar have seen a growth of 8% and 6% in the same period.

Kolkata

Kolkata

With prices of property remaining unchanged in the last 3 months, Kolkata stands out as a perfect real estate investment option. The quarter on quarter analysis shows that prices per square foot have grown by 1% in this time period. Localities like Jessore Road and Ganguly Bagan have seen an appreciation of 11%, while Jadavpur and Garia have seen a hike of 10% during this time.

In terms of decline, Howrah and Salt lake regions have seen a dip of 17% and 15% in this period while Hazra and Alipore has seen a dip of 12% and 10% respectively.

 

Though the prices are witnessing wavy ups and downs, the cities mentioned above still remain the foremost options when it comes to investing your resources and money in India real estate market.

Author Bio:

Anshuman Kukreti is a professional writer and a keen follower of Indian Real estate market. His latest article focusses on Real estate investment in various metropolitan cities of the country. Reach him at anshuman858789@gmail.com.

 

 

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