Chennai Real Estate Market: The Changes
Apart from the fact that new launches have gone up in the city, giants in the sector are also coming up with homes within your means. Around 15 projects, slated for possession by 2018, are coming up in the Chennai real estate market.
Areas, such as Avadi, Poonamallee, Tambaram, Kelambakam, Oragadam, Siruseri, Urappakkam, Ambattur and OMR come under this category. Oragadam, Sriperumbudur, Padapai and Guduvancheri could be marked as locations with potential.
Prices are in the range of Rs 20-50 lakh for 2-BHK units depending on the size and the location. Naturally, if you are opting for homes with amenities such as regular water and electricity supply. Also with other conveniences such as joggers’ track, kids’ play area and shops within your premises, prices go up further.
The peripheries have shed their fringe-look. Of late, the profile of buyers has also been changing, from blue collared to white; the outskirts are now all encompassing.
Top reasons for such a change include increased business investments and opportunities, relatively cheaper real estate prices, cultural diversity and multidisciplinary growth avenues such as digital marketing, advertising, engineering and business. All this has led to a sizeable proportion of new buyers, even non-locals to make real estate investments in the city.
Plots have given way to multi-storey and luxurious Penthouse apartments. Large townships have also entered Padapai, Oragadam and Sriperumbudur.
Four-lane road stretches, IT companies, manufacturing industries, all these came to Sriperumbudur from areas like OMR. Increasing customer base also led to some business giants shifting into bigger units in these locations. When jobs come, buyers will not be far. Guduvancheri would benefit on account of the many IT, industrial as well as educational institutions.
Another reason is its connectivity to OMR and therefore, buyers, looking for an alternative to OMR, have a number of options. Proximity to the airport is another boon.
For a first time buyer, Budget 2016 laid out some favourable provisions. If the value of the house is not more than Rs 50 lakh, then you will be entitled to Rs 50,000 per annum additional interest deduction, provided the loan amount sanctioned is up to Rs 35 lakh. While this was good news for consumers, developers got to have their share with the announcement of cent per cent tax deduction on profits from affordable projects.
Such a move can further the cause of ‘Housing for All’ (There have been debates about the inequitable housing space calculation 30 sq mtr in four metro cities and 60 sq mtr in tier II cities. Because of longer time taken for approvals and construction, though the time for the three-year window for project completion also increases). The direct and indirect tax benefits for affordable housing can catapult the Smart-city initiative too.
What should be good news for home buyers is the fact that as per our inventory data, there are over 400 apartments across Chennai up for sale in the secondary market with a token price within Rs 20 lakhs? Your options double up if you are looking out for plots.
The city index for your city suggests that the average price growth is steadily climbing up. As of now, the good news is that unsold inventory is also piling up which makes it a buyers’ market, where you can negotiate. But various incentives plus pent up demand over the last two years may result in a further hike in prices.
A lot of big names are taking interest in launching affordable homes. Looking at trends in the city, it may be a good time to invest considering that Chennai real estate is seemingly making a comeback. Moreover, if you are sowing small, you needn’t be necessarily reaping small. Trends project that rental yield has been stable, which is encouraging.