The festival season, coupled with the Commonwealth Games, has given residential realty an adrenaline rush and end users are spoilt for choice. PRABHAKAR SINHA writes
Property market is likely to witness a surge in demand with the onset of festival season. To meet this demand, developers and builders have already planned a number of new projects, which are going to be launched in the National Capital Region, Delhi.
The increased supply in the region is a good opportunity to end users to buy a house of their choice at a competitive price.
The surge in demand is not only because of the start of the auspicious festival season, but also due to an improvement in the outlook of the economic growth in the country. As the economic prospects have improved in the last couple of months, hiring of fresh workforce has picked up. The infrastructure development due to the Commonwealth Games will add to the positive sentiment in the realty market.
But, the demand will be price sensitive. Ashutosh Limaye, local director-strategic consulting, Jones Lang LaSalle (JLL) India, said that the demand for right-priced homes in affordable locations would remain steady, but there is also a noticeable slowdown in demand for overpriced areas and projects.
The usual add-on incentives that developers offer during this period will not be much in evidence. Limaye said that builders are aware that their customers are focused on true value, and that it is location, pricing and appreciation potential that are now the primary criteria for Indian residential property buyers.
Obviously, festival-oriented promotional activity will happen as always — but unrelated freebies will be at a minimum, he said. Given the market dynamics now, there will be a greater emphasis on friendlier financial structuring and actual rate discounts instead, he says.
But the demand will witness a revival. In a report on real estate, research firm Edelweiss said, “The festival season is likely to see a number of launches from developers and volumes are likely to pick up on the back of robust demand in the region. After a muted July-September quarter in terms of new launches and project execution, we expect improved traction in the coming months on these fronts backed by a positive hiring outlook and salary hikes, which balance the impact of rising borrowing costs for home buyers.”
The report said that volumes on a pan-India level declined marginally in August 2010, which “we believe can largely be attributable to limited inventory levels across markets coupled with limited new launches in the July-September quarter. Gurgaon volumes also slackened in July and August, which is mainly due to appreciation in prices and limited new launches.”
However, Noida and Greater Noida markets remained an exception where the demand and supply continue to remain strong, since early 2009. This is mainly due to the launch of a number of affordable apartments. But the festival season will witness launches of a large number of new projects. Besides, a large number of townships and apartment projects are already underway in the areas. Developers like Jaypee, Amrapali, Gaursons, Supertech, Assotech, Nirala, Eldeco, Paras, ATS, among others, have already launched large projects in the area. In fact, in Greater Noida Sector 1-4, which is around 10km from Sector 18, Noida — the prime market in this area — around a dozen projects are already under construction.
According to one estimate for the area, which is popularly known as Noida Extension, around 1,00,000 apartments will be developed in the next five years on an area of around 1,000 acre. The entire area will have a number of commercial and educational centres. Such a large number of projects has not only provided humongous options to the home buyers to choose from but also has kept price rise in the region under check.
In fact, in this market one can buy a twobedroom apartment for Rs 14 lakh and a three-bedroom one for Rs 18 lakh. The Noida and Greter Noida real estate markets are providing true value for money. Besides this, there are a large number of projects that are coming up in other parts of the NCR including Kundli, Faridabad, Manesar, among others. In Manesar, DLF is likely to launch a number of projects this Oct-Dec.
Commonwealth Games in Delhi has acted as a blessing to the realty sector in the NCR, says Anuj Puri, chairman and country head, JLL. "Due to the games, connectivity to areas like Noida, Greater Noida, Gurgaon, Manesar and Faridabad has improved considerably. The execution of Metro projects, construction of flyovers and widening of roads has reduced the travel time to these areas from Central and South Delhi considerably. East Delhi, in particular, has benefited the most due to the development of the games village in the area. He also said that the whole Commonwealth Games story has all the ingredients of a major real estate market upgrade. The vastly improved connectivity and quality of residential projects have transformed East Delhi, bringing about extremely robust demand that is predominantly end user driven.
Talking about the games village itself, he says, it is a very contemporary development - the residential properties have every amenity and feature that spell gold in real estate terms thrown in. "It is a signature development that represents absolutely prime location if we consider the accessibility to the CBD and Noida," he says. By virtue of these factors, East Delhi has achieved premium positioning on the Delhi real estate market - and since it is a standalone development located right next to the landmark Akshardham temple, it enjoys locational privileges as well.
