Property prices in Jaipur face a slump

Jaipur has been the top most cities for investment in the state of Rajasthan. However recent reports suggests otherwise. Yes the price of property sites in Jaipur, especially residential ones have been facing a slump in prices. There has been an average decline of close to 4% each quarter over the past year. And these have been worrying signs for the real estate market. In fact there has been a total of 10% decline in property prices in the past year in some localities in the city. Years leading up to the 2013 saw a sharp rise in prices of properties such as apartments for sale in Jaipur. Property prices those years saw a rise of close to 67% which is a mind boggling number for any Tier I city.

"The recent assembly and general elections had an impact hurting demand as investors looked for policy cues from the new governments both at the state and Central level. While the buyers' sentiment cannot be described as bearish, expectations have tempered a bit which is normal after a steamy appreciation. But demand will come back in the couple of months before Diwali which will drive the price appreciation. The reduction of the gap between DLC and market rates will lead to stable pricing regime and will curtail the room for black money transactions although there will be some upward pressure on the property prices" said Vinay Joshi, president, Rajasthan Affordable Housing Developers Association said to the media.

As of today close to 40% of the demand generated in the city for commodities such as property sites in Jaipur come from the end user or home buyers. Home buyers dictate the market to a large extend.  And that is probably one of the reasons why there has been such a disparity in the market in the current scenario.  Apartments for sale in Jaipur today have only a few takers due to the hesitation on the buyer’s part. However with the new government and the budget being announced, things are said to show threads of improvement.
 
"If not rising, housing prices have been stable in recent months. But to say that they have declined by 3.8% doesn't seem to be the case on the ground. Pipeline of developments still remains robust and there 500 projects including all segments and sizes are under various stages of planning and development in the city." said N K Gupta, chairman of Manglam group.
 
Next year is said to be a decider for most Tier I and Tier II cities real estate markets in India. With the purchasing power of the residents of the city improving with the improving economy, things are said to have a trickle down effects on various aspects of the economy and the market. With service sector like IT entering the Jaipur market, the demand for affordable homes and mid segments homes are said to rise. One has to wait and watch how the market responds to the recent developments.

Why properties in Porur are in demand

The real estate sector is Chennai has never really seen the bad days witnessed in the northern markets of the country. The economic slowdown and high inflation did have an effect on the market, but not to the extent that it slumped. The city is considered to be one of the most liveable cities in the country and the real estate here is driven primarily by end users rather than investors. This fact has actually proved to be very beneficial to the realty sector of the city. Since the market is primarily driven by end users, this market is relatively free from speculation which has kept it relatively stable. 

Pockets of growth have been found in northern and western parts of the city. The more well established micro markets in the city which are located in the southern part of Chennai are either saturated or nearing saturation. The number of properties which are available here are also very limited and can be bought by only the affluent folks. The situation is the exact opposite in the northern and western parts of the city were the property rates are much more affordable and there is decent availability of land as well. 

Porur is a micro market which is located in the western part of the city. The area is considered to be one of the most sought after real estate destinations in the city. Multiple factors have worked in the favour of this micro market. The area enjoys great connectivity with the rest of the city. Some of the major roads in Chennai are either passing through this locality or are located in close proximity to it. Major connectors such as the Chennai Bypass Road, the Arcot Road, and National Highway 4 pass through here. The Poonamalle High Road is located in close proximity to the micro market. Apartments in Chennai which are located here tend to be popular among buyers because of the connectivity factor. 

The going rate for apartments in Chennai which are located here are priced at INR 4500 per square feet on average. An individual house for sale in Porur is priced at INR 5200 per square feet on average. There is maximum demand for 2 BHKs in this locality. The unit size which is most preferred here falls between 700 and 1200 square feet. This shows that small to medium sized flats are catching the buyers’ attention as far as this micro market is concerned. The most preferred budget range for flats here falls between INR 30 to 50 lakhs. 

Another reason why a property such as a plot or an individual house for sale in chennai is popular is because of the presence of the Information Technology sector here. There are about three IT parks in this micro market which house many well-known companies. The presence of the Ramchandra Medical College has led to the increase in demand for rental properties here. Areas which surround this micro market have also enjoyed real estate appreciation.