by Mr. Santhosh Kumar, JLL India
Prices
in many established areas of Delhi decline by 10-20%, Gurgaon & Noida remain static,
emerging NCR locations steal the show with 10-35% appreciation
* One City, Different Tunes..!
Residential property prices in
several areas of Delhi having declined by 10-20% in 2013 and then stabilized in
2014. Fence-sitters are watching the market movements to determine if prices
will slide further.
Residential prices in established
locations of South and
Central Delhi such
as Vasant Vihar, Defence
Colony, Jor Bagh
and Golf Links saw a decline of 15-20% in 2013 and remained at those levels in
2014. A correction in prices was also observed in areas like Westend, Shantiniketan, Prithviraj,
Aurangzeb Road and Amrita Shergill Marg, but in a lower
range of 10-15%.
Unlike the slide observed in
areas of Delhi, areas in Gurgaon and
Noida saw prices
remain stable at Rs 6,500-17,000 /sq.ft. and Rs 5,500-8,000/sq.ft. respectively
in 2013. These areas remained stable at the above prices throughout 2014. As
developers remain under pressure due to excess inventory in Gurgaon and Noida,
buyers and investors can expect significant discounts from developers here.
 |
| Santhosh Kumar, JLL India |
In contrast to the negative
market dynamics in areas of Delhi and stagnant prices in Gurgaon and Noida,
upcoming NCR investment locations like
Neemrana, Sohna
and Delhi’s J and L
zones saw an increase
of 15-35% over the same time period. The only
exception to the appreciation observed in these locations was Yamuna
Expressway, which remained stable. However, low land prices and development
potential continue to help Yamuna Expressway remain an attractive destination
for investors.
* Pull Factors Behind Upcoming
Locations..!
There are sound fundamentals
behind why these emerging locations beat the negative trend and saw very good
price appreciation. While Neemrana has massive industrial development along with
good connectivity through the NH-8, Sohna promises the next wave of industrial
and residential growth in Gurgaon. Delhi’s J-zone has the location advantage of
South Delhi and the L-zone is in an area adjoining the upcoming Dwarka-Gurgaon
Expressway.
These are, however, locations
primarily lucrative for investors or those looking for farmhouses. They do not
currently have adequate social infrastructure, and some of them have yet to see
any semblance of the good infrastructure visible in the well-established areas.
Thorough due diligence is a must for buyers making land purchases in these
locations, particularly in Delhi’s J and L zones. The latter have highly
speculative valuations. Additionally, in the L zone, there is uncertainty about
land reservations / demarcations.
* Market Dynamics..!
Overall, the Delhi NCR market is
under stress, which means that valuations remain attractive for end users. This
also points to opportunities for distress sales and bargain buys for investors
/ buyers.
Developers will be under greater
duress by the festive period later this year, during which buyers / investors
can expect good bargains. However, buyers should think ahead of the curve.
If interest rates were to come
down further, they would be well-advised to make purchases by availing of loans
at lower interest rates as in such a scenario, developers will not offer a
similar quantum of discounts as they are currently doing. Smart buyers with
deeper pockets can also purchase property directly from investors, in projects
where the latter price their offerings lower than the developer.
Importantly, buyers should not
fall in the trap of waiting too long. If a project meets all their
requirements, it is prudent to proceed with the purchase, as it does not take
long for reversals to take place in the real estate market.
*
Tips For Buyers And Investors...!
· South and Central Delhi: The next
six months are likely to witness an increase in developers’ pain; persistent
negotiation can result in excellent deals.
· Gurgaon: Apart from corridors such as Sohna Road and
Dwarka Expressway, projects on Golf Course Road are hot tickets.
· Noida: Focus on Noida-Greater Noida Expressway and
Noida City, focusing squarely on developers with proven delivery track record.
· Neemrana, Yamuna Expressway and Sohna: Townships
or plotted projects, group housing projects.
· Delhi-J and L zone: Invest in
ownership or development of farmhouses, townhouses. Due diligence highly
advised for buyers.
Price Changes At A Glance
|
Locations
|
|
Current
prices (INR)
|
|
Price
Change since 2013
|
|
|
Vasant Vihar
|
|
Plots – 7.5-8.0 L per square yard (psyd)
Floors – 45-55 K psf
|
|
15-20% decline
|
|
|
Defence Colony
|
|
Plots – 7.0-8.0 L psyd
Floors – 40-50 K psf
|
|
15-20% decline
|
|
|
Jor Bagh
|
|
Plots – 10.0-13.0 L psyd
Floors – 70-80 K psf
|
|
15-20% decline.
|
|
|
Golf Links
|
|
Individual Row Houses – 14.0-16.0 L psyd
|
|
15-20% decline
|
|
|
Westend, Shantiniketan
|
|
Plots – 8.0-10.0 L psyd
Floors – 60-70 K psf
|
|
10-20% decline
|
|
|
Prithviraj, Aurangzeb Road, Amrita Shergill Marg
|
|
Individual Row Houses – 10.0-12.0 L psyd
|
|
10-15% decline
|
|
|
Gurgaon
|
|
6,500-17,000 psf
|
|
No change. Discounts on offer for buyers.
|
|
|
Noida
|
|
5,500-8,000 psf
|
|
No change. The market has excess inventory and developers
are under pressure.
|
|
|
Yamuna Expressway
|
|
6.0-7.0 crores
|
|
No Change
|
|
|
Sohna
|
|
8.0-12.0 crores
|
|
10-15% increase
|
|
|
Neemrana
|
|
2.0-3.0 crores
|
|
15-20% increase
|
|
|
Delhi – J and L zone
|
|
J Zone- 15.0-30.0 crores
L Zone- 4.0-10.0 crores
|
|
30-35% increase
|
|
About the author.
Mr.
Santhosh Kumar is CEO (Operations
& International Director) at JLL India
For Media contact
Arun Chitnis
Head – Corporate Communications
& Media Relations
JLL India ,
Pune 411001.
Tel: (020) 30930441 Fax: (020) 40196101
Mob: +91 9657129999
Pune 411001.
Tel: (020) 30930441 Fax: (020) 40196101
Mob: +91 9657129999
Website: www.joneslanglasalle.co.in
Twitter: JLLIndia_Realty
No comments:
Post a Comment