Is It The Right Time To Buy Property In Delhi-NCR?
India's most vibrant real estate market — the Delhi-National Capital Region (NCR) — was one among the worst-affected by the recent slowdown in the sector. The region saw a dip in home sales in the past two years. Non-Resident Indian (NRI) investors as well as local home buyers have been waiting for a further price correction, thus delaying their purchase decision.
A huge unsold inventory in the home market helps buyers in two ways. While it increases his bargaining power and the ability to clinch a better deal, he will also have a wide variety to choose from. Currently, there is high unsold inventory in the NCR region. The unsold inventory among both ready-to-move-in apartments and under-construction properties in Noida stands at around 100,000, 21,436 in Gurgaon, 17,189 in Bhiwadi (includes Rewari, Dharuhera, Behror, Manesar and Neemrana), and around 4,000 in Sohna.
The NCR real estate market also has a large number of secondary-sale apartments. While this increases the numbers of homes in the market, it also brings about a set of sellers eager to offload their investments. Most sellers in this segment are the investors, who have already made huge profits over their investment. They are looking to exit these investments to enter other growing areas.
From a buyer's perspective, good bargains can be made by investing in such properties. An added advantage of such properties is that these are fully-constructed and, hence, are less risky.
Property prices have remained stagnant across the country in the past few years. However, Delhi-NCR has shown the least growth. Property prices in Gurgaon, the most-popular investment bet in the NCR, have gone up only two per cent. The city administration kept the circle rates of Gurgaon unchanged for the current year, a rate which is generally increased by 10-15 per cent annually. This is also an indication of a softening price trend. The move was directed to spur real estate activity in the city. In Noida, prices went down by four per cent; in Greater Noida prices saw a fall of three per cent in the April June quarter of the current financial year as compared to the last quarter of the the last financial year (Q4FY14), according to a PropTiger report on the first quarter performance of Indian real estate. Property prices in Bhiwadi went up only by two per cent and that of Sohna went up by four per cent.
However, prices may not remain stagnant in the coming future. The Union Civil Aviation Ministry has approved a new airport in NCR at Jewar, located along the Yamuna Expressway. This would fuel a price rise in that area. Property prices in Noida may also go up in anticipation of an airport.
In the NCR, new areas such as Noida Extension and Yamuna Expressway have a majority of developments in the affordable segment. As many as 50,000 affordable housing units are expected to come in these areas, bringing in more opportunities for home buyers.
(Katya Naidu has been working as a business journalist for the last nine years, and has covered beats across banking, pharma, healthcare, telecom, technology, power, infrastructure, shipping and commodities.)