Real estate is an asset class that demands specialised skills and the complexity surrounding this sector increases in the Indian context. Compared to the mature real estate markets in the developed nations, buyers in India need a higher degree of diligence before entering into property agreements. For the real estate industry, 2016 saw the biggest changes in decades, especially on the policy front. Some of the biggest game-changing policies like GST and RERA cleared hurdles, and are on their way to full implementation. The demonetization move caused considerable turmoil; however, along with the Benami Transactions Act, it promises to bring greater transparency in the real estate sector. The country’s real estate markets are definitely poised for growth in the medium-to-long term on the back of higher transparency and further consolidation. India’s Tier-I cities moved up to the 36th rank in JLL’s biannual Global Real Estate Transparency Index in 2016 due to improvements in structural reforms and liberalisation of the foreign direct investment (FDI) policy. India came 4th in developing Asia in terms of FDI inflows as per the World Investment Report 2016 by the United Nations Conference for Trade and Development.
Here is the list of cities, which are not only good for end-users with small pockets but are also great investment considering the potential price appreciation.
Bhubaneswar and Cuttack
Twin cities Bhubaneswar and Cuttack are among the fastest growing IT and educational hubs in the east. This in turn has boosted real estate development. As most of the available land is government owned, the real estate market is well-regulated. The arrival of national-level players like Assotech, Vipul and Tata has forced local developers to become more process oriented. Rs 50 lakh will fetch properties in upcoming areas like Hanspal, Patrapada, Kanan Vihar and Uttara. Properties in upmarket Kharavela Nagar, Saheed Nagar and Nayapalli can cost up to Rs 1 crore.
Visakhapatnam
Boasting good infrastructure and home to a rapidly growing IT industry, the city is attractive from a real estate perspective. "The bifurcation of Andhra Pradesh has opened up new locations in the state to development," says A.S. Sivaramakrishnan, Head-Residential Services, CBRE India. Visakhapatnam has been drawing the attention of real estate investors. Since 2010, the city has seen good demand for plots and apartments. Residential locations, which are expected to witness capital appreciation in the next five years, include Seethamadhara, Madhurawada, MVP Colony, Packer Layout, Lawson's Bay Colony and Rishikonda. Properties here will cost you between Rs 75 lakh and Rs 1 crore. For more affordable options (around Rs 50 lakh), look towards Gajuwaka, Murli Nagar and Pendurthi Road.
Chennai
The capital of Tamil Nadu is largely an end-user driven market, making it less prone to speculation. North Chennai is predominantly industrial, while central Chennai is the most developed part of the city with established commercial and residential markets. South and west Chennai, previously predominantly residential areas, are fast turning into commercial zones, hosting a large number of IT and financial services companies. Nodes such as Perungudi, Sholinganallur, Siruseri, along with GST Road, have created enormous employment opportunities in south Chennai. "The focus of the state government in providing excellent road connectivity along these nodes has helped in the development of this region," says Kanchana Krishnan, Director - Chennai, Knight Frank India.
Outer Ring Road has emerged as the best upcoming investment market with large townships. Outer Ring Road Phase II and Metro Rail Phase II will become operational late this year. The Guindy-Alandur cluster is expected to emerge stronger in the mediumterm with infrastructure push.
Coimbatore
The 'Manchester of South India' with its burgeoning textile and spinning industry, is the second largest city in Tamil Nadu. The city's activities have diversified beyond textile in recent years to include general engineering, automobile parts manufacturing and IT/ITeS.
Locations like Avinashi Road, Trichy Road, Saravanampatty, Race Course, Ganapathy and Vadavalli are set to witness capital appreciation in the next five to seven years. A 2-BHK apartment can set you back by Rs 50 lakh on Trichy Road, Saravanampatty and Vadavalli. If you have Rs 1 crore, you can get a villa in the outskirts or an apartment in the heart of the city.
. Pune
Proximity to Mumbai and a thriving education, engineering, automobile and IT scene have accelerated real estate activity in this once sleepy city. The Mumbai-Pune Expressway has made Pune a much sought-after location for out-of-town investors, while year-round good weather makes it a preferred destination for homebuyers.
Pune offers properties catering to end users as well as investors at various price points. Prices start at Rs 15 to Rs 30 lakh in the affordable segment. The premium segment starts at Rs 1.3 crore and luxury projects can cost up to Rs 2.5 crore. Vishrantwadi, Dhanori, Kharadi and Whagoli in east Pune and Wakad, Hinjewadi, Ravet and Tathawade in the west are the upcoming areas to scout in.
