Chennai real estate hopes to bounce back after flood waters recede

January 5th, 2016

The tragedy of the recent Chennai floods was harrowing. Thousands of people lost their homes and hundreds lost their lives. The after effects of this natural disaster are still being felt even though the flood waters have receded. As Chennai and its brave inhabitants go back to rebuilding their lives and city, it is important that things return to normalcy as soon as possible. The only thing that helps in forgetting a tragedy is to look forward, to embark on new ventures and to build, create and flourish. And the citizens of Chennai are doing just that – they are looking for new plots, apartments and flats so that they can fulfill their dreams of owning a home.

As is understandable, after a terrible catastrophe like this, the real estate market will undoubtedly be under a lot of pressure. There has been a lot of damage to public property, roads and infrastructure which has an obvious negative impact on real estate prices. Moreover, trends suggest that south Chennai will suffer the most from the floods as the damage has been quite extensive there. However, apart from the negative news, there is a strong consensus among experts that the Chennai market – which was performing well prior to the floods – will recover and bounce back soon and will perform much better after that.

To be clear, the after effects of the floods on the real estate market are likely to last several months – maybe even a couple of years. But the underlying basics of the Chennai real estate market are healthy and once the damage is repaired, investments are expected to continue as usual. One of the most favorable aspects of Chennai real estate which will play a huge part in the recovery is its affordability. Real estate prices in Chennai were on the lower side even before the floods and now they have been pushed down even more. This lays out a fertile scene for investment to flow in and capitalize on the affordability of the real estate in Chennai. Prospective home owners in Chennai are now focusing on areas that haven’t been as badly affected by the floods as some others. As such certain micro markets in Chennai are arousing more interest than others. There has been a marked increase in buyer interest in areas such as Avadi, Redhills and Vandalur. Experts agree that these micro markets will be the seeding ground of the recovery of the Chennai real estate market a couple of years down the line.

Increasing trend of ready-to-occupy homes in Chennai

November 19th, 2015

If you’ve ever bought a house or apartment, you will be able to relate to the stress and tension every buyer goes through when the project is under construction. The worry that the project won’t finish on time distresses every buyer. To avoid this problem, an increasing amount of property buyers in Chennai are turning to ready-to-occupy homes.

What are ready-to-occupy homes?

To put it simply, ready-to-occupy homes are apartments that are either second hand, or are a part of a project that is around 95% complete. In such projects, the internals of the flat are completed and the work on interiors is in progress. As such, it is possible to move into these flats in two-three months at most, a welcome change for buyers who don’t want to wait for a year or two before they move into their new flat.

Why are ready-to-occupy homes becoming popular in Chennai?

One of the main reasons for ready-to-occupy homes being popular in Chennai is that there is a huge supply of flats in Chennai that are as yet unoccupied due to the market reaching saturation. Because of this, finished flats are lying vacant and there is ample opportunity for buyers to capitalize on this.

Another advantage of ready-to-occupy homes is that instead of being shown a model flat or a brochure or a video of the flat, the buyer is able to physically see the finished flat. This means that there won’t be any rude surprises for the buyer – as in the case of under-construction project – and the buyer will get what he/she sees.

From a financial perspective also, ready-to-occupy apartments in Chennai are also a lucrative option. Granted, the finished flats are slightly more expensive than under-construction ones but the fact that the buyer can move in to the new flat quickly means that he/she doesn’t have to bear the dual burden of rent and EMI. If the buyer is living in a rented house and takes a loan for buying a new flat, he/she will have to pay both; when it comes to ready-to-occupy homes, the buyer will only have to pay the EMI.

Another financial advantage for purchasing ready-to-occupy homes in Chennai is that the buyer can avail income tax benefits on a ready property. This, along with all the other reasons, makes finished homes in Chennai an amazingly attractive option for buyers.

So if you’re looking to invest in the Chennai real estate market and don’t want to wait for years before you move into your own home, why not opt for a ready-to-occupy home? There’s less risk, financial advantages and the benefit of seeing your actual home before buying it!

Velachery and Ambattur- The rising sectors in Chennai

September 9th, 2015

Chennai is one of the most modern and developed metro cities in India. The people in Chennai embrace both modern lifestyles, but at the same time hold close to their heart, the traditional values of their culture.  This is also reflected in their real estate preferences.  The citizens of this metro city are known to choose location above any other attributes of a home and this drives most of the real estate demand in the city.  Integrated townships and gated communities are yet to be accepted completely by the city as the people here believe in no walls and complete openness amongst neighbours.

Ambattur:

Ambattur is one of the Chennai’s most prominent and fast developing suburbs.  It houses an equal mix of both industrial as well as residential properties and is highly preferred among workers and professionals working here.

Earlier, Ambattur belonged to the Thiruvallur Taluk, began showing immense growth in 1960 when the state government decided to establish various small scale industries here.  Many prestigious companies like the TI Cycles and Britannia set up production units here and many settlements mushroomed around it catering to the need of the workers here.  Closer to the more affluent regions like Anna Nagar and Padi, Ambattur is in much demand as it gives some experience of a luxurious life to the people here.

After 2005, Ambattur came to be known as another IT hub in the city.  This has attracted yet greater real estate in the surrounding area.  Even today, this area hold great potential for IT and MNCs to set up office and many prestigious companies like the Dell, and HCL have rooted here.  This has led to an upsurge in the demand for luxury homes.

Velachery:

Located in Southern Chennai, the area is rapidly developing year after year.  It is currently attracting the more affluent crowd in the city and its luxury and ultra modern living spaces are in much demand.

The prices in the area have shown an appreciation of 10 to 20 % in the past two years.  The reason for the rapid development of the locality is due to the presence of one of the most important IT hub in the city – Old Mahabalipuram Road (OMR).

Velachery is also easily accessible via roads, rails and metros.  The area is also blessed with well developed infrastructure and physical amenities.  There are a number of good schools, colleges, malls and hospitals in the locality catering to all the needs of life.

The demand for living spaces is mainly coming from the IT professionals who wish to live close to their workplace. Another group are the NRIs who buy home here due to the location advantages and the high return on investment.  The main two categories of living spaces in demand are villas and studio apartments.

Both the locations are rated well for living, however, the prices in Velachery is higher as the area is more affluent than Ambattur.  Ambattur is mainly preferred by those in the middle income groups.

The Unique Propositions And The Developing Trends In Chennai Housing

January 10th, 2015

If you compare the situation to the rest of the India, then you will find that the real-estate scene is far more stable in Chennai than the leading Indian metropolis. It is the perspective of the inmates and the end users that matters the most. The latter has a role to play in stabilizing the demand-supply curve of Chennai. As a result of this, the so-called price turmoil doesn’t affect the Chennai scenario. But the similar is not true of the other Indian metropolis including the satellite townships of Gurgaon and those surrounding the NCR. The cost upheaval might have affected some of the parts in Chennai including the proverbially acclaimed expensive destinations. But by and large, the scenario presents a stable picture.

The end-users are more prone to settling down in Chennai than using the purchased property as a source of investment. Of course, the focus on investment is there, but with the settlement being the driving priority, the investment angle takes a long-term perspective. People are keener on buying property for long-term usage.  The concept of buying now and selling tomorrow is yet to make its way. Subsequently, the housing market doesn’t involve the angle of speculation. The latter is responsible for bringing about steep rises and fall in the capital value. On the other hand, the absence of speculation contributes to the growth and sustenance of a stable scenario.

To go by the census counts of 2011, Chennai boasted of having as many as one million households. The collection of residential housing units touches the mark of 1.5 million. As per the statistical analysis of the last year in 2013, the city merited a mention in the topmost twenty-five real-estate location. The objective was to categorize cities across the Asia-Pacific belt in the order of their importance. The metropolitan hub notched up the twenty-second position. The city presents a well-developed look, and as the premiere facilitator of the automobile industry; it goes down as one of the most sought after commercial centers.

Despite the curves and cuts of developments; there are glitches and issues to confront. Overpopulation and pollution are two of the leading bottlenecks to take into the account. Traffic congestion, poor economic conditions and not having enough accommodations to meet the needs of the underprivileged and the low-income earners are the other areas that merit attention. By the close of 2016, the city’s developmental nexuses are supposed to give shape to as many as 420,000 residential units. These will exclusively cater to the needs of the underprivileged and the low-wage earners.

Paucity of open spaces is one of the issues that have come in the way to real-estate development. The prospect prevented developers from generating projects that are eco-friendly. The factor also prevented them from developing plans with top-class and amenities. In the current scheme of things, one gets to notice a shift in paradigm. More and more developers are looking forward to basing their projects on the peripheral areas. As a result the regions such as Sriperumbudur, Oragadum, ECR, OMR and Porur are coming up with integrated township development plans and projects. The automobile sector and the increasing predominance of the IT industry have worked hand in hand to revolutionize the concept of community housing.

 

The Unique Propositions And The Developing Trends In Chennai Housing

November 13th, 2014

If you compare the situation to the rest of the India, then you will find that the real-estate scene is far more stable in Chennai than the leading Indian metropolis. It is the perspective of the inmates and the end users that matters the most. The latter has a role to play in stabilizing the demand-supply curve of Chennai. As a result of this, the so-called price turmoil doesn’t affect the Chennai scenario. But the similar is not true of the other Indian metropolis including the satellite townships of Gurgaon and those surrounding the NCR. The cost upheaval might have affected some of the parts in Chennai including the proverbially acclaimed expensive destinations. But by and large, the scenario presents a stable picture.

 

The end-users are more prone to settling down in Chennai than using the purchased property as a source of investment. Of course, the focus on investment is there, but with the settlement being the driving priority, the investment angle takes a long-term perspective. People are keener on buying property for long-term usage. The concept of buying now and selling tomorrow is yet to make its way. Subsequently, the housing market doesn’t involve the angle of speculation. The latter is responsible for bringing about steep rises and fall in the capital value. On the other hand, the absence of speculation contributes to the growth and sustenance of a stable scenario.

 

To go by the census counts of 2011, Chennai boasted of having as many as one million households. The collection of residential housing units touches the mark of 1.5 million. As per the statistical analysis of the last year in 2013, the city merited a mention in the topmost twenty-five real-estate location. The objective was to categorize cities across the Asia-Pacific belt in the order of their importance. The metropolitan hub notched up the twenty-second position. The city presents a well-developed look, and as the premiere facilitator of the automobile industry; it goes down as one of the most sought after commercial centers.

 

Despite the curves and cuts of developments; there are glitches and issues to confront. Overpopulation and pollution are two of the leading bottlenecks to take into the account. Traffic congestion, poor economic conditions and not having enough accommodations to meet the needs of the underprivileged and the low-income earners are the other areas that merit attention. By the close of 2016, the city’s developmental nexuses are supposed to give shape to as many as 420,000 residential units. These will exclusively cater to the needs of the underprivileged and the low-wage earners.

 

Paucity of open spaces is one of the issues that have come in the way to real-estate development. The prospect prevented developers from generating projects that are eco-friendly. The factor also prevented them from developing plans with top-class and amenities. In the current scheme of things, one gets to notice a shift in paradigm. More and more developers are looking forward to basing their projects on the peripheral areas. As a result the regions such as Sriperumbudur, Oragadum, ECR, OMR and Porur are coming up with integrated township development plans and projects. The automobile sector and the increasing predominance of the IT industry have worked hand in hand to revolutionize the concept of community housing in chennai.

Additional Toll Booths On The Ambattur-Porur Length Of The Chennai Bypass

October 15th, 2014

The Chennai bypass is one of the busiest stretches of roads in the region, and the maintenance and upkeep of the roadway are of utmost importance. Until now the motorists traversing along the road had to pay no fees. However, the scene is changing as the NHAI is planning to introduce the practice of collecting tolls on the usage along the Ambattur – Porur stretch of the road. The plan in effect involves the establishment of five new booths. They will collect user fees on the service roads ending the free rides on the stretch.

The authority responsible for the maintenance and operation of the Chennai Bypass, the MEP Chennai Bypass Toll Road Private Ltd has decided to collect toll from the vehicles that use over 5 km of the road and. The body that is the OMT or the Operation, Maintenance and Tolling concessionaire of the roadway has already begun installing the toll booths to catch those who evaded the payments. The over-smart motorists used the service roads to bypass the tolls and returned to the main road as the tolls were past. With this move, the authority seeks to capture the funds that leaked out in the simple manner of withholding of funds.

Some additional booths are also planned in the vicinity of Porur, Chettiyar Agaram Road and Vanagaram and on the either sides of the Ambattur Industrial Estates. The City of Chennai Bypass is just over 32 km, and any vehicle that moves through the service roads can do so, however, if they use the main carriageway they need to pay the toll. Such initiatives will help the motorists respect the rules and stick to the norms set out by the officials. The initiative was brought forward after the responsibility of the bypass changed hands. While NHAI operated the road, there was no need for the motorists to pay for using the main carriageway within the Ambattur – Porur stretch.

While local authorities welcome it heartily, regular travelers are not too happy. They use the 5 km stretch to their work or needs, and they feel the practice of using just the 5 km stretch is unjust and too much. The practice of free transport under NHAI was better. There was no particular need for the concessionaire to enhance the fees to get revenue from the 5 km stretch alone. Most of the protest came from the lorry owners who traverse the distances to move goods along the area.

Additional problems arise for the daily commuters who have been using the road to get to offices every day. Paying the toll every day for just the small distance is not only difficult but also an unnecessary expense. They have to bear the expense while the offices will not reimburse the same. Commuting to the industrial estates, where most offices are, will become difficult and an expensive proposition. It is hopeful that the OMT will arrive at a solution to suit both sides, and there will be no further problems regarding the same for the introduction of tolls in the commonly used highway.

Sholinganallur in Chennai is witnessing an increase in rental value for multi-storey apartments

January 17th, 2014

Sholinganallur in South Chennai is witnessing an increase in rental values for multi-storey apartments. The developing IT business parks and the Special Economic Zones (SEZs) have fuelled growth in the rental real estate market in this area. The monthly rental values for multi-storey apartments have climbed to Rs 15,300 in the Jul-Sep 2013 quarter from Rs 12,500 in the Apr-Jun 2013 quarter. The locality has seen a rise of 15 per cent in capital values, while the rental market recorded a 7 per cent growth during the Jul-Sep 2013 quarter.  Sholinganallur offers a wide variety of multi-storey apartments from single floor apartments, from residential houses to villas. A 2BHK apartment of 600-1,200 sq ft is available for Rs 10,000-16,000 per month. While a 3BHK commands Rs 25,000-40,000 per month. Units of 1BHK can be found in the range of Rs 6,500-9,000 per month. Spread over 1,700-2,100 sq ft, villas are available for Rs 20,000-25,000 per month. Connectivity is another major contributor in fueling demand for rented accommodation. Sholinganallur is located at a five minute walking distance from Old Mahabalipuram Road (OMR), and is well connected through roadways and railways. The social and civic infrastructure of Sholinganallur is well-developed. Schools, colleges, hospitals and hotels are present in the locality. MTC (Chennai) Ltd buses and auto-rickshaws are among the modes of public transport for the residents.

According to Lalith Jain of Lalith Real Estate, “Sholinganallur is close various IT parks such as Siruseri IT Park, PSBB Millennium and Gateway International within a 15 minutes driving distance. As per Bala of Sai real estate, “The major roads include East Coast Road (ECR), Link Road and Velachery Main Road. While the airport is about 21 km via OMR, Central Railway station is about 24 km from the same route. The Metropolitan Transport Corporation (MTC) bus stop is about 2 km away with Velachery MRTS situated at a distance of 14 km”.

Source: The Times of India

T Nagar witness highrisk due to No- Fire-proof Mechanism in Highrise commercial buildings.

December 16th, 2013

T Nagar in Chennai is witnessing a high risk of fire in highrise commercial buildings. This is due to no safety fire proof mechanism in these buildings. According to a report from the fire and rescue services none of the 145 highrise commercial buildings in T Nagar, especially those on Usman Road and Ranganathan Street, and another 21 buildings on Arcot Road in Kodambakkam has fire-proof mechanism in place. Yet nothing has been done to make these places safe.

According to the National Building Code of India, 2005, buildings above 15 metres to should makes it mandatory for having fire extinguishers, hose reels, sprinklers, wet risers, yard hydrants, automatic smoke detection system, underground and overhead water tanks with a capacity of 10 kilo litres and 100 kilo litres and emergency exits. According to a fire and rescue service officials who surveyed the buildings on Usman Road said none of them had any of the facilities but for fire extinguishers. Many buildings on Ranganathan Street do not even have fire extinguishers.

Lack of stringent legal provisions has enabled traders and builders escape action. In reply to an RTI application by V Jayaraman, a resident of T Nagar, the divisional fire official admitted to lack of stringent provisions. A committee appointed by the Madras high court (which initiated the survey) to look into unauthorised buildings built before 1999 has been sitting on safety reports. An official said it has not met since January 2013. Differences with the government over the introduction of the 2012 regularisation scheme for buildings constructed before July 1, 2007 had some non-official members of the committee quitting.

According to M G Devasahayam, former bureaucrat and a member of the committee, “The state has sabotaged the functioning of the committee which wanted to conduct surveys across the city”. According to CMDA sources, the matter was sub judice and waiting orders of the high court. “We have submitted the survey report of the fire and rescue services to the court,” was all an official had to say.

Source: The Times of India

Urapakkam in Chennai offers house within Rs 40 lakh.

October 1st, 2013

Urapakkam in South Chennai is offering houses within a budget of Rs 20-45 lakh. Strategically located on the GST Road, the area turns out to be a potential option for both buyers and investors. With a host of positive factors such as smooth connectivity, proximity to IT companies and infrastructure upgrades this area is displaying a robust real estate development.  The area is mainly attracting the demand from the IT professionals working in the nearby IT Parks such as Mahindra World City, Sriram Gateway, L&T Estancia and Krisp IT Park. Also, through the Chennai Bypass Road, Oragadam is just forty minutes away. Hence, people working in this industrial hub also prefer Urapakkam to reduce their daily commute time. In addition, Urapakkam is all set to get a facelift as many infrastructural projects are under construction.

Interestingly, proximity to IT companies is driving demand for rental accommodation in this area. From furnished to unfurnished, there are various options available with amenities such as power backup, gymnasium and car parking, to name a few. A standard 2BHK apartment is available in the price band of Rs 6,000-8,000 per month, while a 3BHK apartment commands anywhere between Rs 8,000-10,000 per month. Considering this spiraling graph of real estate, Urapakkam has become an irresistible lure for the developers. There has been a steady increase in the supply of condominiums. Alameen International Ltd, P Dot G Construction Pvt Ltd, KLF Foundations are some of the developers coming up with their projects in the area.

According to S Kirubakaran of Remax Choice, “The construction of Railway Over Bridge that was started in 2010 is nearing completion.” Further, being just next to Vandalur, the area will also get a shot in the arm in terms of connectivity with the Phase I of proposed Monorail Corridor, which stretches from Vandalur to Puzhal.

Source: The Times of India

Chennai witness an increase in Property Price

September 27th, 2013

Though the Chennai’s overall housing market shows a slowed downtrend, the demand for city properties is increasing day by day. With the opening up of housing sector and the influx of pan India developers, suburbs and peripheral areas in Chennai got a virtual boost for development. Yet Chennaiites are adhering to city lifestyle as they feel that the social infrastructure in suburbs would take years, if not decades for development. This is one reason for the continued surge in demand for city properties. Areas such as Adyar, Alwarpet, Anna Nagar East, Besant Nagar, Boat Club Road, Indira Nagar, Kilpauk, Mandaveli, Sri Nagar colony, T Nagar, Tiruvanmiyur and Valmiki Nagar in particular illustrate the soaring price appreciation trend.

Property consultants feel that for the price of a city property, one can own luxury villas in suburbs and peripheral areas. Today, a 1000 sq ft apartment in the city costs not less than Rs 1 crore and location specific homebuyers are keen to garner the options available in city areas. The rigid demand has even pushed the resale property values to a new high so much so that the difference between new unit and a resale unit is hovering between 20 and 30 per cent. A newly built apartment comprising 4000 sq ft in Shastri Nagar, Adyar, was sold for Rs 8.25 crore notching up a rate of Rs 20625 per sq ft, according to realtors.

The city’s East Coast Road, considered as the entertainment corridor, and provides multiple options for the nouveau riche in the city. Expatriate population is in need of beach houses in proximity to international schools and social infrastructure. Investors are keen to plunge into the market on seeing the rental values ranging from Rs 75,000- 2.5 lakh per month with corporate driving the demand. Villas by several developers are dotting the skyline of ECR today ranging in price from Rs 2-5 crore where leasing prospects are considered good.

Source: The Times of India, Chennai