With the express growth of commercial sectors, especially IT and ITES industries, the twin city Noida and Greater Noida are thriving as a realty sector of Delhi NCR. The city becomes a popular destination for an investment ranging from residential to commercial real estate market. Hence, the builders in Noida and Greater Noida are developing residential and commercial properties with world-class entities and innovative infrastructure.
Various builders are coming up with the concept of residential to studio apartments, township projects, shopping malls and corporate business parks. The twin city is a bit inexpensive than rest of NCR and capital. The prices of property are also affordable as compared with other regions hence, buyers and investors prefer the city for realty investment.
The online directory or the list is available to search for suitable property with affordability. Builders are coming up with various townships, residential and commercial projects with eco-friendly concepts. The projects are constructed with lots of open space, lush greenery, magnificent sun-rays and fresh breeze.
The realty projects in twin city tenders world class amenities such as two- level basement parking, children’s park, gym, spa, CCTV surveillance, power backup, intercom facility, individual R. O. unit, modular kitchen and many more.
Beyond the oft-repeated developers’ rhetoric ‘location, location and location’ as the USP of the project, lies the fact that today’s prime location was once a deserted area that most developers were not ready to bet on with the kind of huge investment that realty projects demand. It has not just been the huge investment involved but the infrastructure, or rather lack of it, which often made them play safe. Though, in some of the cases, the government authorities took the initiative to provide the necessary infrastructure and auctioned the land to the developers; in some of the other cases, it was the developer who spotted opportunity in a virgin territory and reaped the first mover advantage.
It would be easy to vouchsafe that while the state, in most of the cases, has been a reluctant urbaniser, destination development actually demands a daredevil’s vision and that is precisely the reason why only a handful of locations could see the first mover changing the dynamics of urbanisation in general and the realty market in particular.
The first such case study in India has been the emergence of Gurgaon, at a time, when urban land development was in the controlled regime of the state. Facing many challenges at the policy level, it was the vision of KP Singh, chairman, DLF, to replicate a global city in India that Gurgaon was conceptualised, ahead of its time. According to Sanjey Roy, spokesperson, DLF, “Gurgaon was initially conceptualised as DLF Qutab Enclave and the plan was visualised ahead of its time. It was not an easy job, particularly at a time when the urban land development was in the controlled state regime. The success story of Gurgaon eventually led to the development of many such destinations across the country.”
He also adds “One needs to have a vision to transform a nondescript location into a property hotspot. Once it is developed, it is much easier to do a cost-benefit analysis and say the location could have been developed this way or that way. When DLF first ventured into Gurgaon, Delhi needed to outgrow its boundaries with the growing urbanisation. Gurgaon, for one, was picked up as an extension of what, at that point of time, was the most sought-after tourist hotspot, Qutab Minar,” explains Roy.
Similarly, in Mumbai, it has been the developers’ vision that has created destinations in far off suburbs such as Powai. The fact remains that had the Hiranandanis also thought about playing with the land competence of ‘location, location and location’, Powai would not have emerged the way it has shaped up today. Some other locations, like Malad, Goregaon, Kalyan and Dombivli, are also shaping up as excellent destinations. Interestingly, these destinations were spotted by developers who recognised an opportunity in an area which had, for others, been the road less travelled.
Similarly, the Nahar Group’s initiative of developing a new township in Chandivali has resulted in making Chandivali a destination suburb. The Group had begun development in this lesser known area, at a time when not much development was happening in that suburb.
The idea was to, in the next few years, make this location one of the most-preferred destinations in Mumbai city. Today, Chandivali competes with other locations such as Powai, in residential real estate. Manju Yagnik, vice-chairperson, Nahar Group, agrees that to some extent, it is risky to venture into new destinations with no habitation and infrastructure. Hence, developers undertake some research or study before starting with a new project. Location has its own importance in real estate development but creation of residential projects can also be undertaken by the developer, from a futuristic point of view.
“A developer can also create new destinations, by providing amenities and facilities essential for smooth living. Earlier, this suburb was hardly known for residential or commercial development, as a major part of this area was deserted land. Today, the vast 125 acres of land, is full of greenery and plush residential towers and commercial complex. Besides proximity to the domestic and international airport, business districts in Mumbai and arterial roads of Mumbai, have made Chandivali a new destination of Mumbai city,” states Yagnik.
Similarly, when the Knight Frank report, last year, rated south Chennai’s Pallikaranai and Medavakkam, as two of the most promising destinations, many within the built environment of realty business, were taken aback. Even though, Pallikaranai and Medavakkam are about 12 kms from the Chennai International Airport, through the Pallavaram-Thuraipakkam Road, it was not seen as a ‘destination’ till some of the developers spotted an opportunity and shifted their focus to the region, for developing it as the destination next.
There are not many case studies in Indian real estate, where a developer has a vision and has shown the audacity to take the road less-travelled. Experience also suggests that some of them had to take a beating but for those who could spot the right location to be developed as a destination; it proved to be a goldmine. Those who want to capitalise on sheer land competence, established location is all that matters but for those who do not want to be ‘me too’ in the established locations, there are still virgin territories to be explored.
A land parcel as large as 100 acre about 10-11 km from the Connaught Place, New Delhi, is expected to be unlocked for affordable housing soon! The Ghaziabad Development Authority (GDA) is planning to come up with 14-15 group housing projects on this land near the Wazirabad Entry Gate in Delhi. The project planning is currently at a nascent stage.
So are there any affordable housing schemes the authority is offering at present? According to Santosh Kumar Yadav, vice chairman, GDA, “we have some plots left in Madhuban Bapudham Scheme.” This group housing project falls near Govindpuram. This is the only project which has plotted development on the offer at present, by the GDA.
What are the sizes and what are the prices of these plots? The plots are generally available in the 400 sq ft size. They are priced at Rs 13,600 per sq mtr. “The project is good to invest. In five years, the prices of the plots have just got doubled,” says Yadav. He was answering queries on Open House, an online platform where users can ask questions on a specified subject.
Are there any flats available for the Low Income Group (LIG) and Economically Weaker Section (EWS)? The authority is planning for affordable housing projects at various locations within Indirapuram and Kaushambi. The sizes of these flats start from 35 sq mtr with prices starting from Rs 5.10 lakh.
Almost all the projects will have units for people from the EWS category as well. The size of these units will be around 25 sq m and the prices of these units will be about Rs 2.40 lakh.
What are the eligibility criteria? For applying for a flat under the LIG category, your monthly income should not exceed Rs 12,000. For the EWS category, this limit is kept at Rs 6,000 per month.
But what about livability? In view of creating sufficient supporting infrastructure, the GDA is also planning several projects concerned with roads, water supply, electricity and drainage. Recently, the authority announced setting-up of a power sub-station at Madhuban Bapudham Scheme.
May God bless the person who coined the adage “live life king size”. Today every one, of course who can afford and bear the cost, aspires for the best of facilities and wish to live life king size. Growth of economy and liberalisation has resulted in an increased disposable income in the hands of the new generation which has in turn leveraged the spending capacity of everything luxurious including homes for the proposed buyers.
Ambit of luxury segment has changed today from what it used to be in the last decade. Today the luxury segment – from luxury cell phones to extravagant exotic holidays to luxurious swanky cars – is dominated by the young breed of professionals. So, when it comes to living space they would not settle for anything less but the most exclusive, expensive and luxurious.
This segment of population is not just hard to please but also well informed about the latest trends across the globe, making developers strive to deliver exceptional quality residences. Today, people are traveling worldwide and getting exposed to international standards and this exposure and experience has infected every aspect of the human life. They desire to enjoy, if not same, at least very near to the same level of comfort and services back home. Highly-placed professionals, top consultants, individual business houses, investment bankers, young entrepreneurs and globe trotters belong to the segment of people who are more likely to invest in luxury properties.
Today, High Net-worth Individuals desire exclusivity, uniqueness and customisation in every nook and corner of their homes, which is being met with the increased association of internationally renowned designers. Luxury homes are now witnessing world-class standard of living. Traditional households are also seeking better lifestyle and hence, are moving out of the city cluster to newer horizons.
“Branded homes” have become a craze with the affluent class, where many developers tie-up with luxury brands to provide unique combination of brand and luxury. Amenities such as gyms, spas, golf courses, swimming pools and community clubs have become a sort of necessity. Developers are also regularly exploring new horizons to make their products sell like hot cakes.
Most of the luxury homes are being developed in the prime locations – away from the hustle and bustle of the city. Green houses are the newest craze and demand of the time. The concept of luxury housing has revolutionised the whole experience of living with increasing rate of High Net-worth Individuals and the rapid pace of urbanization.
NOIDA: In a move that will aid buyers in choosing legally sound projects, the Noida, Greater Noida and Yamuna authorities are planning to upload details of all builders constructing housing projects on their official websites. The decision was taken after Uttar Pradesh chief minister Akhilesh Yadav directed the authorities to ensure protection for buyers and design a route to evade property-related cheatings.
The chairman of Noida, Greater Noida and Yamuna Expressway authorities, Rama Raman, said directions have been issued to start the process to buy server space for the websites to upload property-related details.
Aggrieved buyers have been demanding for a long time that details of all builders’ projects should be made available online. “Checking legality of land and developers projects would be just a click away. We have planned to upload all land ownership and title-related details on our website. Apart from that, lease deed conditions, status of sanctioning building layout plan and other NOCs and notices issued to developers will also be uploaded,” said Rama Raman.
“We have also asked the developers to upload the sanctioned layout plan copy and other approvals on their company websites as well,” Raman added. “We hope to complete the entire process by the year end,” said Manoj Rai, OSD, Noida Authority.
“The region has become a den for land sharks who have been cheating innocent investors. Even though several property frauds have been committed, they have hardly been reported due to laxity by police and authorities,” said a homebuyer.
Developers have welcomed the decision and hope this would be a great step towards ensuring transparency. “This move will instill confidence in the real estate sector. Now buyers will be able to identify genuine developers from fraudulent ones. Apart from that, this decision will increase the faith of investors in the real estate market in this region,” said Vijay Gupta of Orris Infrastructure.
“This move will undoubtedly be a significant tool for all prospective buyers to understand the nature of projects in a better manner. Incomplete information is more harmful than no information. Hence, availability of information on authorities’ website would enable buyers to take a better decision towards their investment,” said Brijesh Bhanote, director (sales & marketing), The 3C Company.
The association of developers, CREDAI, now hopes to get NRIs to invest in the projects. “An investor sitting kilometres away from Noida would be able to check the legality through authentic government websites,” said RK Arora, CMD Supertech and vice-president CREDAI (Western UP).
The Delhi NCR realty market is still a favourite destination for affordable, mid-, and high-end housing segments. A K TIWARY writes
The Delhi NCR residential market is still a favourite destination for affordable, mid-, and high-end housing segments, even in this period of economic slowdown.
A recent report says that with increasing demand of housing cutting across segments in the Delhi NCR realty market, nearly 9,600 units were launched in the third quarter of this year. This is on a par with the number of units launched in the second quarter, and constitutes 22% of the total launches across Top 8 cities in the country like Bangalore, Ahmedabad, Pune, Chennai, Hyderabad, and Kolkata.
The NCR saw a total absorption of 35,000 units in the first half of 2013, showing an increase of 18% from the same period in 2012. Increase in sales can also be ascribed to the high number of project launches in the affordable category. While sluggish buyer sentiment has discouraged sales in some areas, locations like Dwarka Expressway, Noida Expressway, and Greater Noida continue to lure investors.
The affordable, mid-end and high-end segment contributed almost equally to the total launch activity during the quarter. The NCR market registered the highest contribution, 33% of all the high-end launch activity, among the Top 8 cities of India during the third quarter of the year. The majority of the high-end launches in the NCR were located in Gurgaon while the affordable units were concentrated in Noida. The twin cities of Noida and Greater Noida have together contributed nearly 55% of the total number of units launched while Gurgaon accounted for 44% during the quarter.
Reason for demand in the NCR
Realty experts say that over the past two years, the NCR market saw a fall in launches-by nearly 40%-compared to the peak levels of 2010. Short term and long term moving average of launches confirm a plummeting trend.
However, demand has recently stabilized and improved in the last few quarters, which indicates a healthy residential market scene for the NCR-and, if the supplydemand gap tapers further, the region is likely to face an upward pressure on property prices.
Shishir Baijal, CMD of Knight Frank India, says: “The NCR residential market indicated signs of stability in the first half of 2013. Nearly 49,000 units were launched in this period showing a marginal increase of 11%, compared to the first half of 2012. However, a comparison with the first half of 2011 and 2010 reveals a dip of 33% and 59%, respectively. It is quite evident that developers are keeping new launches in check in order to bridge the supply and demand gap.”
Developers have been cautious and remain focused on selling their existing projects rather than launching newer ones. Also, there are great opportunities in the secondary market for projects under construction because investors want to liquidate and reduce holdings. In fact, discounts are being offered in the range of 15-20% depending on the project size and the location. So, overall, this is a good time for people to buy as developers are willing to negotiate the right price and ready to close transactions. Cushman & Wakefield, global real estate consultants, says in a report that the Top 8 cities have seen an estimated residential unit launch of 1,32,000 units between January and September, 2013, which represents an increase of 5% over the same period in 2012.
The high-end property launches in the first three quarters of 2013, which was recorded at 23,500 units, has seen the highest growth at 142% over the same period last year, while launches
in the luxury-housing category recorded a decline of 10.5% between January and September, 2013, over the same period last year.
Shveta Jain, executive director (residential services) of Cushman & Wakefield, says: “Contrary to b y tradition, there has been a decline in new launch activities in the third quarter of 2013, as economic conditions have not been encouraging for developers. The slowdown in demand is largely owing to the low confidence of the consumer, who is put off by increased and consistently high pricing in key cities. Having said that, the demand from first-time buyers and end users has been consistent, as genuine buyers with adequate capital look at this phase as ideal to enter the property market on account of stable capital values.”
Apart from the Delhi NCR, Ahmedabad, Bangalore, and Chennai have seen a quarter on quarter increase of 41%, 25%, and 28% respectively till the third quarter. Though Hyderabad saw the maximum decline of 56% in launches compared to the second quarter of 2013, it however saw one of the highest rises in y-o-y (year-on-year) appreciations. The number of launches in 2013 more than tripled in Bangalore, to nearly 35,000, till September, 2013. Bangalore, the NCR, and Mumbai, contributed 27%, 23% and 19%, respectively, of the launches across the Top 8 cities in 2013.
Rentals have remained stable across most of cities, except Ahmedabad, which registered 4-10% decline in rentals across segments. Gurgaon in the NCR also registered a 4-12% dip in rental values for high-end spaces. Bangalore saw the maximum appreciation,
4-12%, q-o-q (quarter-onquarter) across a few submarkets in the mid-end segment capital values due to persistent demand from working population.
Kolkata registered 5-7% appreciation in capital values of prime areas, due to growing demand for high-end projects in these locations. Capital values across segments in Chennai, Hyderabad, and Pune remained stable during the quarter due to sluggish sales, subdued demand and rising construction costs.
High-end segment capital values in locations like Lower Parel and Worli in southcentral Mumbai declined by 2%, while in Gurgaon, they fell by 3-5%, which is likely to boost demand and push transaction activity in an oversupply scenario. Ahmedabad registered the maximum price correction of 4-8% across the majority of the markets for both mid-end and high-end segments in the third quarter of this year.
After a slow start in the first half of the year, the launch activity seems to have picked up in Ahmedabad, with 2,100 units launched in the third quarter of 2013. This was an increase of 41% q-o-q and exceeded the total number of launches during the first half of the year. Despite the sluggish market, significant pick up in the launch activity over the last two quarters could majorly be attributed to the fact that some planned projects can no longer be delayed further. Nearly 51% of the launches in this quarter were in the affordable segment and a majority of the launches were concentrated in the peripheral areas of SG Highway and Bopal.
Bangalore saw 13,200 units launched, accounting for the highest share of 30% launches across the Top 8 cities during the third quarter of the year.
It was the only city to cross the 10,000 units mark in launches for the third consecutive quarter in the year.
Despite the higher number of launches, the mid-end segment saw an appreciation of 5-12% in capital values across select sub markets. This was been primarily due to the growing demand of residential units in proximity to IT hubs and the paucity of new launches in certain central areas of the city.
A majority of the launches in the midend segment were concentrated in areas like Sarjapur Road and Bannerghatta Road in the south, Whitefield in east and Yelahanka and Jakkur in the north of Bangalore. The realty market of Chennai has continued to register an upsurge in the number of new launches for residential units in the third quarter of this year with more than 4,100 units launched. Nearly 94% of these launches are in the mid-end segment, followed by 4% in the affordable, and the remainder in the high-end segment. Compared to the last quarter, the high-end segment registered a decline of 41% in the number of new launches in the third quarter of 2013. It is expected that the next quarter will see the completion of 6,000 units, which will infuse new residential supply in the Chennai market.
Hyderabad saw nearly 1,945 units launched this quarter, a decline of nearly 56% compared to the second quarter. With Hyderabad contributing only 4% of the total launches across the Top 8 cities, activity in the residential market continued to be sluggish here. The mid-end segment contributed to more than half of the total launch activity in the quarter with Kukatpally registering the maximum activity in the segment. The affordable segment comprised 33% of the total demand followed by high-end segment at 11%.
Mumbai, the commercial capital of India, has seen nearly 7,200 unit launched in the third quarter of 2013. Though this was a decline of nearly 34% q-o-q, it was an increase of 19% for the first three quarters of the year, and was on a par with the average number of quarterly launches in the city over the past two years.
The decline in launches over the second quarter could mainly be attributed to slow sales in the market and the delay in regulatory approvals, as a result of which the fourth quarter might see a slight increase in launch activity. Panvel in Navi Mumbai contributed 64% of these unit launches in the third quarter with major contribution from a single large project. Central suburban areas like Mulund, Powai, and Wadala contributed 13% of the launches followed by Thane at 10%.
Nearly 3,850 units were launched in Pune this quarter out of which two-third came from the mid-end segment and rest from the high-end segment. Amidst sluggish sales, piling up inventories and soaring construction costs, the launch activity saw a decline of nearly 13% q-o-q, as developers adopted a wait-and-watch approach.
Source:Time of India
It is not advisable for end users to postpone their buying decision in the hope that prices will fall; they must grab the discounts that developers are offering and buy their long-cherished home.
The slowdown in the economy has led to sluggish demand in almost all the sectors including real estate. However, consultants say that this is the right time for end users to buy their longcherished home. As builders are in a tight position, many of them are offering huge discounts, even up to 15%—this is not reflected in their official rate chart, though, but the offer holds for the customers who pay cash down. A builder said that as soon as the demand starts looking up, they will withdraw this discount; thus, once the economy looks up, we can expect the prices to automatically go up. In fact, the emerging trend is also suggesting that developers are not cutting the price, but they are ready to pass on the holding cost to buyers. As the rate of interest at which a builder can raise fund is very high, they find it attractive to give a discount of around 15%, which is their cost of fund, to their customers. At the same time, a customer can borrow a home loan at around 10%. In fact, to attract the borrowers, many banks are offering home loans at less than 10%. Not only this, some of them are even waiving off the processing fees.
Taking all these market dynamics into consideration, a consultant said that if someone wants to buy a house for his personal use, this would be the right time to enter the market. He argued that home loan rate is not likely to fall further from the current level, and also that builders would find it difficult to lower the prices of houses further down. In fact, developers and consultants argue that prices of apartment or plotted development in the NCR are not likely to fall.
They argue that to beat the slowdown in demand, developers cut down on new launches. This will reflect in the availability of apartments in the near future in many submarkets like Noida, Greater Noida, Gurgaon, Ghaziabad, Indirapuram, Crossings Republik, and Sonipat. Knight Frank, a global realty consultancy firm, says in its report that despite falling demand, the capital value appreciation in Gurgaon and Noida could be explained due to a steeper fall in project launches, thereby putting an upward pressure on prices.
The report says: “As per the current trends, the NCR residential market is showing a slowdown in terms of project launches. However, this bodes well with the current market sentiment as absorption has picked up, which will further help in bridging the supply-demand gap. At the same time, liquidity constraints coupled with the increase in construction costs will continue to pose a challenge for developers leading to a further slowdown in project launches. This may put upward pressure on prices, which will certainly attract investors.” The report says that the longterm and short-term moving average of launches confirm a plummeting trend.
A similar analysis of residential sales velocity highlights that the long-term moving average of absorption in the NCR market has recently stabilized after a falling trend.
In fact, demand has significantly improved in the last few quarters leading to a substantial improvement in the shortterm moving average. During January-June 2013, the NCR residential market registered a total absorption of 35,000 unitsshowing an increase of 18% over the first half of 2012. This increase in sales can be ascribed to the high number of project launches in the affordable category.
It is important to note that the Knight Frank report says this upward trend in absorption with limited launches clearly indicates that the NCR market is striving to reach a better equilibrium. In case this trend continues for a couple of quarters, the supply-demand gap will taper further leading to an upward pressure on property prices. Over the past two years, project launches have fallen by nearly 40% compared to the peak levels of 2010, the report said. Despite favourable absorption levels in recent quarters, NCR’s residential market displays a high quarters-to-sell (QTS) ratio as the volume of unsold inventory has been building.
Noida registered a steep dip of 72% in newly-launched projects in the first half of 2013, compared to the same period last year, reflecting the cautious sentiments of developers to not oversupply the market, the report said. The report said absorption in Greater Noida, which includes Greater Noida West (formerly known as Noida Extension), the newly-launched projects rosealmost four times compared to the same period in 2012, suggesting a strong demand for affordable options, which is easy on the buyer’s pocket. Absorption levels dipped in Gurgaon and Noida, largely due to increasing un-affordability of the housing options in these markets. In these conditions, it is not advisable for end users to postpone their buying decisions in the hope that prices would fall. In fact, developers, in order to increase their sales volume, are offering huge discounts on their available projects.
The NCR has seen a slowdown during 2012. Massive delays in project deliveries coupled with the economic slowdown have affected demand, as consumers have become cautious and are delaying home-buying decisions. Taking cue from this trend, developers have begun focusing on project execution and are deferring new launches. Greater Noida and Noida account for more than half of the units under construction in the NCR market. Both these micromarkets are backed by robust infrastructural developments.
Noida is perceived to be a prime end-user market in the NCR due to the presence of good physical and social infrastructure; its proximity to south Delhi and the abundant job opportunities it offers are also an attractive proposition. The main developers in this part of the city are Jaypee, Unitech, Amrapali, Supertech, Gaursons, Ajnara, Paramount, ATS, Antriksh, Mahagun, etc.
Greater Noida, on the other hand, enjoys the presence of large contiguous land parcels that are ideal for group-housing projects. However, compared to Gurgaon and Noida, the residential market in Greater Noida has been somewhat cautious because of the lack of commercial presence to support the residential supply.
Gurgaon is the second largest contributor to the NCR residential market. This micromarket accounts for 24% of the units under construction. New infrastructural developments and the presence of prominent builders like DLF, Tata, Unitech, IREO, M3M, Rahejas, Emaar, etc, have made Gurgaon one of the favoured residential markets in the NCR, with primarily mid- to highsegment projects. The primary developing areas in Gurgaon are Golf Course Extension Road, Southern Peripheral Road, Dwarka Expressway, Manesar, and Jaipur Highway.
Bhiwadi and Dharuhera are the developing residential hubs catering to the affordable-housing demand, which has been created by the continual industrial development in these locations.
Ghaziabad and Faridabad account for nearly 20% of the units under construction in the NCR market. Both these markets are backed by industrial growth. Faridabad’s areas like Old Faridabad and sectors on NH-2, Neharpar, and Surajkund Road have seen ample residential project launches during the last few years. On the other hand, Indirapuram, Crossings Republik, and Raj Nagar Extension are some of preferred locations within Ghaziabad.
Preferred locations in the affordable ranges are Yamuna Expressway, TechZone IV, and Jaypee Sports City—in the price range of Rs 2,500-3,500 per sq ft. Availability of huge land parcels and reasonable prices help developers in launching projects in the affordable and mid-segment range with a ticket size of less than Rs 5 million. The fact that developers have been focusing on affordable and mid-segment housing accords well with an increase in project launches in Ghaziabad, which is another market having similar offerings.
A majority of the projects launched in Ghaziabad are in Raj Nagar Extension, mainly a mid-segment residential area that boasts of good connectivity and infrastructure, with highways under construction and a proposed Metro line. Most of the units launched in Ghaziabad are below the Rs 5 million bracket, with an average unit size of 1,000-1,500 sq ft.
Source: Times of India