To Keep House Prices In Check, Construct More Roads

“It is not wealth that built our roads but roads that built our wealth.” This line by former American president John F Kennedy holds true not only for the US but also India. Road infrastructure seems to be closely linked to residential price movements. Length of road construction is known to have a direct bearing on real estate. More importantly, it is equally vital in potentially lowering average house prices, particularly in urban areas, as can be seen in the graph below.

Anuj Puri, Chairman & Country Head, JLL India

Anuj Puri, Chairman & Country Head, JLL India

 

As road lengths increase, connectivity improves across a wider geography – thereby attracting new project launches at lower price points. This can reduce prices in urban agglomerations. If more roads are constructed in rural areas, price rise in urban cities could be restricted to moderate levels. This would help increase affordable housing projects near the metros.

Currently, the only solution to the problem of urban housing shortage in Indian cities is building new infrastructure to connect more precincts to the city centre. This theory becomes clearer when we compare the pan-India average residential price growth to the total length of road constructed in India annually which is released by the Ministry of Roads.

Not surprisingly, there was a strong inverse correlation between the two indicators. It suggests that when new roads are constructed across rural and urban areas, the spread of development happens over a wider geography. This can potentially bring down the premium that certain urban agglomerations command for having better connectivity. This could be particularly true for infrastructure-starved cities in India such as Mumbai and Bengaluru.

Fortunately, road infrastructure has emerged as a key focus area for the current government. According to media reports earlier this year, the road transport and highways ministry has set an ambitious target of laying more than 40 km of roads every day in 2016-17 – more than double the current pace. The construction target too has been set at 15,000 km against the 6,000 km constructed last year.

The Indian government plans to invest INR 3 trillion (US$ 44.73 billion) for developing 35,000 km of roads across the country, of which 21,000 km will be economic corridors and 14,000 km will be feeder routes. This is expected to improve freight movement, ease traffic bottlenecks and improve inter-city connectivity in the country. It will be interesting to watch residential property price movements in the coming years.

Source: News

Is E-commerce Replacing Physical Retail In India?

Anuj Puri, Chairman & Country Head, JLL India

Anuj Puri, Chairman & Country Head, JLL India

India’s retail market value was estimated at $520 billion in 2013, and is expected to grow to $950 billion by 2018. With a CAGR currently pegged at 13%, the Indian e-commerce market is expected to grow the fastest within the Asia-Pacific Region – with its market size doubling every 2-2.5 years. This certainly gives us reason for deep introspection. While the global growth rate of online shoppers is estimated at 8-10%, India currently has more than 10 million online shoppers.

Though 70% of India’s e-commerce market is related to travel (flights, hotel bookings, etc.), electronics and apparels are by far the most important categories in terms of sales. The key driver Indian e-commerce is the rapid increase of broadband internet penetration, which is growing at a whopping 20% every year. The rising standards of the mushrooming middle-class with high disposable incomes, coupled with the urban influence on rural aspirations, have led to an exponential growth of the internet culture in India.

This is very pertinent to the Indian retail sector. The internet has given Indian consumers access to a wide spectrum of products and services, even in places where brick-and-mortar shopping complexes have not reached. Also, the availability of a much wider range of products when compared to physical retail stores, coupled with relatively lower prices, is driving demand for online retail. With the evolution of the online marketplace, sites like Flipkart, Snapdeal, OLX and Jabong are thriving and more and more Indians are buying goods online.

E-commerce in India took off with a deluge of portals, including many focused on travel, media and jobs. The governments’ drive to open the sector for FDI in B2B business via the automatic route and bring e-commerce to the centre stage has caused a number of major players to venture into India. Today, Ebay, Amazon, Expedia and some serious Indian players are giving these physical retailers a run for their money.

Flipkart and Snapdeal’s recent fund-raising exercise put paid to the argument that investors are moving away from Indian e-commerce. The change in government and the stride of positive sentiment across the nation has led to growing faith in India and Indian business models. The governments’ initiative to simplify regulations and make India a business-friendly nation is definitely benefiting e-commerce.

Today, manufacturers and retailers running brick-and-mortar stores are anxiously asking the government to intervene with the creation of a regulatory body to stop e-retailers from undercutting prices. Physical retailers are definitely feeling the heat by the marketing blitz of their online counterparts, and the question of whether e-commerce is pushing out brick-and-mortar retailers looms large.

Many big companies are rising to the challenge and adopting smarter strategies to guard their turf. The likes of Tata, Future Group and Reliance are expanding their reach by foraying into e-commerce via alliances with leading online players. Indian retailers have clearly read the writing on the wall. As the competition grows, an omni-channel approach to delivering a unified and consistent customer experience is the new watchword.

Improving the overall experience is the avenue to success. Regardless of whether we’re talking about e-retailing, traditional brick-and-mortar retailing or a combination of both, the winners in this new steeplechase will have to evolve their offering to meet the needs, wants and desires of consumers. Retailers will increasingly have to offer services through various mediums.

However, e-commerce is still unlikely to completely replace or even seriously dent physical retail in this country. For Indians, malls are more than just shopping destinations – they are getaways from the humdrum and constraints of their day-to-day life, and mall developers have been catering to this dynamic by creating shopping complexes that offer retail, entertainment and dine-out option under a single roof. This is not a combination of offerings that even the slickest e-commerce operator can hope to compete with. ‘Experiential Retail’ is the holy mantra of the Indian shopper, and in the years to come, every mall across the country will do everything it can to turn the whole shopping experience into an entertainment experience.

BJP’s Majority Show: Impact On Infrastructure And Real Estate Initiatives

Ramesh Nair, COO, JLL India

Ramesh Nair, COO, JLL India

With BJP controlling the Centre and the two biggest real estate markets in India – Mumbai and Gurgaon – the government has to focus on 3 I’s – Infrastructure, Interest reduction and Income generation. With the BJP’s remarkable show in Maharashtra, the state will give a new lease of life to its infrastructure projects across all sectors. The projects which are being monitored by the central government will get accelerated with the BJP government’s assumption of political power in Maharashtra.

We have seen the Central Government take a keen interest in the real estate sector. It is evident that it has understood that enhancements in real estate can provide an impetus for growth across various sectors, generating tremendous employment and thereby boost the entire economic outlook for the country. The BJP-led Maharashtra State government can be seen drawing lines along the same goal.

With several infrastructure and real estate initiatives mentioned by BJP in its manifesto, and with the intent to facilitate projects worth INR 11 lakh crore, these projects are likely to get a push in Maharashtra in the coming days. The government is expected to fast-track the new international airport in Panvel, the 22 km Trans-Harbour Link connecting Sewri and Nhava Seva and the Bullet Train connecting Mumbai and Ahmedabad. The airport and trans-harbour link will be game-changers for the Navi Mumbai real estate market, and help to decongest Mumbai by releasing vast tracts of land in Navi Mumbai for development.

The BJP-led state government plans to have a business district like BKC in all the municipalities within MMR. With a business district in each one of the seven MMR municipalities – Greater Mumbai, Navi Mumbai, Thane, Kalyan-Dombivali, Vasai-Virar, Mira-Bhayander, Bhiwandi-Nizampur and Ulhasnagar – the state will receive quite a few Peripheral Business Districts (PBDs) in the MMR region and enable the local populations to get jobs closer to their homes. This, in turn, will help attract IT/ITES companies that typically prefer lower-cost cities such as Bangalore and Pune, and generate much-needed jobs in Mumbai. This, in turn, will fuel the affordable housing segment and create much-needed IT, R&D and campus-style business parks across the city.

The next phases of the elevated railway, water transport, metro and monorail projects envisaged long back will again be in the spotlight as they hold great potential for enhancing connectivity in all micro-markets of Mumbai. The Thane market will see significantly accelerated growth if the feasibility studies favour the setting-up of an airport in the Kalyan-Ambernath belt. As far as water transport is concerned, Mumbai will be an important hub for the water transport initiative along the Konkan coast. This will benefit CBD and SBD North, which are the prospective areas from where the city will be connected.

The Government plans to widen the Mumbai-Goa Highway to a 4-lane highway and the area surrounding the Mumbai-Pune Expressway will be taken up for development. This will have a positive impact on Navi Mumbai, as it is the primary micro-market in the vicinity.

‘Make in Maharashtra’, an offshoot of the Prime Minister’s Make in India initiative, will be a major game-changer for the Delhi-Mumbai Industrial Corridor (DMIC) and the manufacturing hub of Pune. Mumbai will be the logical choice for almost all the MNC companies for establishing front offices to complement any investment in Maharashtra.

The IT industry will be promoted in a big way to attract business parks and IT jobs into the state with a view to compete with destinations like Bangalore and Hyderabad. IT Industry Area Development Authority will be established to promote the IT sector in Mumbai, Pune, Nagpur, Nashik, Aurangabad and Kolhapur. With the India Shining sentiment making a decisive comeback, more opportunities will arise in office space transactions. The state governments’ proposal to establish 10 smart cities in Maharashtra has very favourable connotations for the commercial capital of India.

The Governments’ initiative to install CCTVs across Mumbai, Pune, Nashik, Aurangabad and Nagpur will not only increase the overall safety and security quotient in these cities, but also present a favourable image of Maharashtra to MNC players who give significant importance to the safety and security aspects. Apart from this, several other initiatives such as fast broadband for the entire state, fast-tracked IT hardware production and creation of a hardware hubs along with the promotion of the mobile applications, gaming development and cyber security industries will help push up office space demand.

The digitizing of public and land documents such as 7/12 forms and making these available online will not only improve transparency but also promote faster approvals for land transactions.

The relaxation of FSI norms has been received very positively by developers, and will be a major catalyst for more purchases of raw land for development. However, the increase in FSI can also lead to further stagnation of residential property values. The perceived influx of supply in the market may lead to a correction in prices on Mumbai’s real estate market. However, market sentiments will turn more positive and this should increase funding requirements, as developers will actively take up more projects.

The Government’s focus on better governance and its initiative to implement new reforms such as the Real Estate Bill and single-window project clearances will not only help rein in real estate-related corruption but also regularize the functioning of the real estate sector. The state Government is expected to further push and implement the NDA’s central manifesto of housing for all by 2022.

There is an express need for the approval process to be streamlined and expedited. Easy approvals will lead to faster clearances and thereby a steady supply in the market, which will keep property prices affordable. We definitely expect the Government to be more developer-friendly. Fast-tracked reform measures in the environmental approval process and clear policies on real estate will add more clarity and lead to faster execution. If the BMC sees power realignment, and if this helps new reforms and regulations to come through faster, then Mumbai’s real estate sector will definitely be a clear winner.

Not In My Backyard – NIMBYism In Indian Real Estate

Kishor Pate, CMD - Amit Enterprises Housing Ltd.

Kishor Pate, CMD – Amit Enterprises Housing Ltd.

NIMBY is not a term we often hear in India, though it is quite a popular word (and a dynamic concept) in the West. That said, NIMBY – an acronym for ‘Not In My Back Yard – is definitely an unspoken mind-set when it comes to residential real estate in India.
Basically, ‘Nimbys’ are residents of a locality of project who are opposed to the implementation of a certain initiative by the Government, industries or private developers in their neighbourhood. Classic examples in the Indian context are flyovers, chemical factories, power plants and in fact any kind of development that could conceivably obstruct the view, disrupt the peace or pollute the air.

‘Nimbyism’ does exist in the Indian real estate space, but the choices of opponents to certain developments within their neighbourhoods is generally quite restricted. The Indian real estate space is still largely unorganized, and problems such as encroachment, unauthorized structures and lack of scientific town planning are still the order of the day in most of our cities.

The concepts of regulated real estate development and macro-level town planning are beginning to take hold and are, in fact, already operational in cities like Chandigarh, Navi Mumbai and even in Pune. While this evolution is happening against a large backdrop of damage that already been done and is difficult to undo, this does not mean that ‘Nimbyism’ is a futile and impotent concept in India.

In Indian residential real estate, middle-class housing societies – administrative bodies comprised of residents within a registered housing complex – have the right to refuse unscheduled construction within the complex premises. That said, they have little or no control over what happens beyond the compound walls. In cities like Mumbai and Delhi, upscale housing complexes continue to co-exist cheek-to-jowl with slums and slapdash tenements. This is more or less accepted as a reality of life, since slums are often under the political protection.

The ultra-luxury segment presents a rather different picture. Indian cities do have their elite pockets, such as Lutyens Zone in Delhi, Nariman Point in Mumbai, Sahakar Nagar in Pune, Jubilee Hills in Hyderabad, and so on. In these areas, residents have a stronger voice over what happens in their immediate neighbourhoods – and they do raise them. This level of influence derives from a combination of factors – including the financial clout of the residents, the fact that the zones themselves are under the purview of stricter-than-usual zoning guidelines.

As such, Nimbyism is definitely not a negative concept – in fact, cities like Pune need a larger dose of it. Residents should have a say in what happens in their neighbourhoods. This is especially true if the developments they are opposing are taking place outside of the existing zoning laws and are serious threats to the health, harmony and safety. What is needed is more exacting city planning, which should ideally be part of the overall development plan for the city. Likewise, developers also have a responsibility towards ensuring the sanctity of the residential projects they create.

Investing In Pune Luxury Homes

Kishor Pate, CMD - Amit Enterprises Housing Ltd.

Kishor Pate, CMD – Amit Enterprises Housing Ltd.

During 2013, the investment potential for residential properties in the financial capital of Mumbai remained largely flat and unexciting. Most serious property investors in Mumbai who chose residential property are now content to exit with moderate profits. Pune, on the other hand, showed an almost uniform appreciation of 14-16% in property prices. Vacancy levels in Pune stand at between 20-22%, while in Mumbai they are close to 35%. As a result, investors are staying invested.

One question being asked by investors interested in Pune real estate is whether they should prefer mid-income or luxury housing. To be sure, Pune has a number of options in both segments. Mid-income apartments are definitely the faster-moving product on the market. However, luxury housing in Pune has been getting a lot of exposure of late, mainly because it is a much more vibrant segment in this city than in Mumbai.

It has been argued that Pune has seen far too many luxury projects being launched in the last two to three years. However, the fact is that these projects are not aimed primarily at property investors but at NRI and HNI buyers who are purchasing such homes for personal use. Property investors focused on Pune have always been more interested in acquiring mid-range flats which they can dispose of faster. This is a limited perspective, usually brought on my budget constraints.

There is, in fact, a very high demand for luxury property in Pune from self-use buyers, which is why developers continue to see sense in launching premium housing. It must be remembered that as long as there is demand, supply will follow. And as long as the demand is from buyers who wish to own such properties for personal use, there is no glut on the market – these units will not be put up for sale again for a very long time.

For this reason, investment in luxury property in Pune does make sense for long-term investors. These are premium offerings in locations which will eventually not be able to accommodate further development. However, it is a play which requires high investment power and the ability to hold on to the property for at least five to seven years. After such a period, the real estate development potential of a location which is popular today will be almost exhausted and demand will begin peaking.

There is no doubt that demand for luxury housing in Pune is very sustainable. An increasing number of multinational companies are recognizing Pune’s unique advantages in terms of trained manpower, cheaper real estate costs and reduced logistical hassles. The result is that more and more high-paying jobs are being created every year, which leads to a steady demand for high-end homes. At the same time, more and more NRIs from Pune who have completed their high-paying tenures abroad are returning every year.

Obviously, luxury homes in key areas such as Aundh, Baner, Sahakarnagar, Model Colony, Aundh, Koregaon Park, Kalyaninagar and Viman Nagar will become increasingly valuable over time. But within a span of five to seven years, even newer areas will have been made valuable because of increased infrastructure and accelerated saturation. Investing in a luxury property in such an area today can pay off handsomely over the long term.

The Advantages Of Buying Vs. Renting A Home

Arvind Jain, Managing Director - Pride Group

Arvind Jain, Managing Director – Pride Group

If you’ve been indecisive about buying a home and have so far preferred to rent instead, this is a good time to finally make your move. Home ownership is one of life’s greatest joys, but that is not the only reason why you should finally take the plunge.

The advantages of home ownership today include:

1. Bargains:

It is a buyer’s market now. There have never been more developers in the fray, and there is a huge number of projects out there to choose from. This means that you can get a real bargain today – and that too with top developers who are known for excellent locations, construction and project amenities. Even with a less-than-spectacular budget, you can now own a decent home in a good neighbourhood. Banks are also falling over each other to sanction home loans. In other words, your application will get successfully processed faster than ever before.

2. Investment Value:

When you pay rent on a home, the money is basically gone forever. You get no returns and no security – all that your money has paid for is accommodation. The landlord gets richer, but you have not reaped any investment benefits. It is true that buying a home involves a large initial financial expense. However, unlike with paying rent, these expenses are recovered over time, because you are building equity in your own home. Residential property in major Indian cities appreciates very well indeed. Remember, home ownership is not only about occupancy but also about long-term investment. Also, you save tax on your home loan.

3. A Sense Of Community And Belonging:

People who rent homes in a major city never really build firm relationships with their neighbours. When you own a home, your children make long-lasting friendships, and the adults in your family become part of a long-term support system. Research has proved that people who have healthy relationships tend to be happier and have less stress in their lives.

4. The Security Of Ownership:

Obviously, home ownership means that the home is yours – not somebody else’s. There are various advantages built into this, because you have the right to do what you want with your home. In other words, you can renovate, refurbish, paint and decorate it as much as you please (within the bounds of the housing society byelaws, of course). In short, you can make your own residential property into a real home. Also, you have the financial assurance of a rock-solid asset to fall back on if the need arises.

Can The Government Do More For Affordable Housing?

Sachin Agarwal, CMD - Maple Shelters

Sachin Agarwal, CMD – Maple Shelters

Narendra Modi’s government has made massive forward strides within a short period. The progress in such a short period is remarkable, considering that the government is still hamstrung by a disproportionate fiscal deficit and its ability to induce further growth through public investment.

It is evident that the Modi Government cannot leave any stone unturned in order to bring about an environment that is attractive as easy to navigate for private investors. But judging from what we have seen so far, the real estate industry in India is definitely back on track in 2014. Still, there are complex challenges that remain. Two of these are inflation and, despite the demonstrated good intention, affordable housing.

On the inflation front, the RBI and the Modi government have taken a determined stand. From a larger perspective, inflation obviously impacts the overall borrowing cost in the economy and as a result is a major stumbling block for faster economic growth. But the effect of inflation on real estate as an industry is quite pronounced because it acts as a deterrent to spending by consumers and increases the financial burden of home loan borrowing. In such an environment, home purchase sentiment will remain subdued.

But inflation also has a grievous effect on the construction sector. The Indian construction industry is very dependent on raw materials like steel and cement. The higher the cost of constructing a residential project, the higher will be the cost of flats. Indian developers are seriously challenged by the constantly increasing cost of construction. The rise in this cost has been no less than 18% every year for the last four years. It is surprising and extremely worrying that the recent Union Budget did not make any provisions to bring the cost of construction down.

Inflation should not be tackled only by keeping borrowing rates high. Another way to bring it down which is very pertinent to the real estate construction industry is to fast-track the development of roads and highways so that goods can be transported more quickly and efficiently. Raw materials for construction are constantly sourced from all over the country. At the same time, the method in which tax is levied on such goods as they cross state borders must be simplified. In other words, the introduction of GST (Goods and Services Tax) system is very important at this stage.

When it comes to affordable housing as a segment, many of the measures that were pending for a long time materialized in the recent Union Budget. The affordable housing segment was finally given priority by granting the benefits of infrastructure status. The RBI also increased the limit for home loans availed for purchasing budget homes. Previously, the limit was a mere Rs. 25 lakh and this has now been raised to Rs 65 lakhs in the primary Indian cities and Rs. 50 lakh in tier 2 and tier 3 cities and towns.

But there is more to encouraging affordable housing than just incentivizing banks. Developers of such housing projects must also be given more breaks so that affordable housing development becomes more attractive and therefore encourages more builders to join the bandwagon. The ‘smart cities’ concept is getting a lot of limelight today, but what a country like India really needs is ‘affordable cities’.

Finally, there is a lot of land in the core areas of our cities that is being held by various government bodies. We have seen enough instances where such land is auctioned off to the highest-bidding developers who want to build luxury housing on these plots. If the current government is really focused on encouraging affordable housing in India, then it must release such land solely for the creation of such housing.

PCMC’s Golden Location Matrix Widens Into Punawale

Anil Pharande, Chairman – Pharande Spaces

Anil Pharande, Chairman – Pharande Spaces

While real estate is a constantly changing and evolving concept, some parameters remain constant – the three success mantras are still Location, Location and Location. In this respect, the Pimpri-Chinchwad Municipal Corporation (or PCMC) is an important chapter in the annals of Pune real estate’s success story.

Pimpri-Chinchwad, an Urban Agglomeration (UA) of Pune, is situated only 1.5 hours from Navi Mumbai. It is by far the richest Municipal Corporation – not only in India, but in Asia, largely thanks to its thriving industrial belt of mid-sized and large national and multinational companies.

Thanks to massive demand for residential and commercial properties, PCMC has delivered some of Pune’s hottest real estate locations over the past decade. Punawale, situated in PCMC along the rapidly developing Western corridor of Pune, is the latest addition to the region’s lineup of strategic real estate development and investment hotspots.

Located advantageously close to Hinjewadi and its burgeoning IT Park and the Pune-Mumbai Expressway, Punawale has now emerged as the location of choice for home buyers from the Information Technology as well as manufacturing segments.

Punawale is also in close proximity to Wakad and benefits from convenient access to various hospitals, schools and shopping malls.

This combination of factors has had a big impact on demand for properties in Punawale, and has led to the launch of many new residential projects. Puneville, a luxury township recently launched by PCMC’s leading developers Pharande Spaces, is one of the most notable examples of Punawale’s massive image makeover on the Pune real estate map.

Like Moshi, Ravet, Spine Road and many other highly successful real estate locations in the PCMC, Punawale has the added advantage of being located at the fulcrum of various mega road development projects by this region’s infrastructure-focused town planning authorities. Backed by the unlimited cash reserves at the disposal of Asia’s wealthiest Municipal Corporation, these projects are being implemented at a rapid rate and have been instrumental in the highly positive credit ratings accorded to the PCMC by various reputed agencies.

Additionally, the high-tech PCMC Water Treatment Plant was recently awarded the coveted ISO – 9001- 2000 rating in the Water Treatment Quality category, further enhancing the region’s viability as a location and residential destination par excellence.

Backed by a diverse and vibrant economy which provides a convincing complement to that of Pune, PCMC boasts of a prolific manufacturing sector represented by a number of national and global industry giants.

The steady and growing pipeline of employment opportunities generated by PCMC’s manufacturing and Information Technology industries has ensured that areas like Punawale see instant absorption of housing projects across budget brackets. It goes without saying that an employment-driven real estate location like Punawale also receives significant attention from property investors.

In Punawale, the Pimpri-Chinchwad Municipal Corporation has created yet another iconic location to take this prosperous, infrastructure-driven region’s globally acknowledged reputation for planned urbanization and real estate development to the next level.

About The Author:

Anil Pharande Chairman of Pharande Spaces, the pre-eminent construction and development firm in the thriving, pro-infrastructure Pimpri-Chinchwad Municipal Corporation (PCMC) region of Pune. Pharande Spaces has a number of integrated township projects in PCMC areas such as Moshi, Ravet, Punawale and Spine Road to its credit.

Obsolete Homes: The Decreasing Attractiveness Of Resale Flats

Kishor Pate, CMD - Amit Enterprises Housing Ltd.

Kishor Pate, CMD – Amit Enterprises Housing Ltd.

Historically, cities like Mumbai, Pune, Bangalore and Chennai have always enjoyed a strong resale residential market. This made sense – because of a lack of progress in terms innovation by developers for almost two decades, homes in old projects did not offer significant advantages over homes in older projects. Buyers were primarily focused on price and flat size, and the resale market tended to offer good deals on both counts.

This scenario has now changed visibly, and a new trend of ‘home obsolescence’ has now become a firmly entrenched market dynamic. Fundamentally, the process that renders homes obsolete can be compared to that of electronics and home appliances. Because of rapid technological advancements and high competitiveness among suppliers of such goods, the newer range of products has very attractive added features that make older models redundant and undesirable.

Obsoleting is also a very real fact in real estate, as well. Commercial spaces in ageing office complexes tend to evince less interest by occupiers because they lack the modern features of newer office projects. Likewise, residential projects which were developed as little as five years ago lack the attractive value-adds which are available in the latest projects. Construction technology, design trends at a project and individual unit level, internal fittings such as plumbing, sanitaryware and electrical appliances have all taken a quantum leap forward in terms of functionality, user-friendliness, visual appeal and cost effectiveness.

In many cases, older projects often do not have adequate parking, common amenities and open spaces, as they were developed before the latest regulations concerning these were enforced. The combined effect of these has resulted in the rapidly reducing popularity of resale homes among home buyers. While it is true that some resale properties offer more central locations, it is equally true that these locations tend to be beset by massive infrastructure deadlocks today. Also, older projects will lose in investment value at a rate proportionate to the age of the project.

In contrast, buyers who chose to opt for a brand new flat have several advantages. In the first place, they can opt to invest in an apartment at significant discounts while the project is still under construction. Secondly, they benefit from the fact that such projects have fresher designs, are fully compliant with latest development regulations and have features such as rainwater harvesting and reserved parking. The units themselves have the latest electrical fittings and have superior layouts. Meanwhile, the investment value of new flats remains on an upward trajectory for several years.

While the resale market will doubtlessly continue to draw attention, more and more home buyers in cities like Mumbai and Pune will not settle for less than a brand-new flat with the latest features, fittings and other advantages.

Why Talegaon Needs More Affordable Housing

Sachin Agarwal, CMD - Maple Shelters

Sachin Agarwal, CMD – Maple Shelters

Though Talegaon has long since been identified as a very suitable destination for residential property investment in Pune, most of the talk about this serene and nature-rich location has been about row houses, larger premium flats and senior living projects. As a matter of fact, a sizeable share of the demand for flats in Talegaon actually comes from locals and people who have migrated there to seek employment in the many industries operating in Talegaon.

Talegaon is situated 40 kilometres from Pune on the Mumbai-Bangalore highway, far enough from the main city to have escaped mass real estate development and thereby retain its exceptional natural attributes. Thanks to the fact that Talegaon is located at a higher elevation above sea level, it enjoys better climate than the central regions of Pune. Nevertheless, this is a key growth location by virtue of being located at the nexus point of Pune, Nashik and Mumbai.

This factor has made Talegaon a focus area for many industries. They are attracted not only by the excellent location but the lower land rates and the fact that Mumbai is just 135 kilometres away via the Mumbai-Pune Expressway. Residential real estate in Talegaon is driven by employees from the industrial zones in Maval and Chakan as well as the IT/ITeS companies in Hinjewadi. Furthermore, Talegaon benefits from easy access to excellent educational institutes, which is always a point of favour for home seekers.

The second homes and even premium flats business is doing very well in Talegaon because of its bracing environmental qualities and the IT-driven demand from Hinjewadi, which is just 20 kilometres away. However, the main need in this location is for affordable housing, and it is this requirement that low-cost housing initiatives like Aapla Ghar by Maple Shelters seek to fulfill.

Employees of the many automobile and industrial manufacturing companies in and around Talegaon cannot afford the mid-level and high-bracket offerings that developers have been churning out. Yet, it is imperative for them to live close to their places of work, since Talegaon is relatively far from areas where most budget housing is coming up.

Flats priced below Rs. 10 lakh, yet available with contemporary housing projects with all the conveniences of modern living, are the need of the hour at Talegaon. Vacation homes in Talegaon will always be desirable to buyers and investors from Pune and Mumbai. But it is the supply of affordably-priced flats that is a key factor for this region’s continued viability.

It is the employees of its industrial and automobile firms who are the real pillars of its enviable economic progress. They are not here for Talegaon’s natural splendour – they have either been there from the beginning or have moved there to find employment. It is critical that their needs are addressed, as well.