Track2Realty Exclusive: The imprint in the minds of collective consciousness is about affordable market when it comes to Noida; the reality is increasingly getting different from perception. It is no more about affordable housing that defines Noida, nor is it about small industrial clusters; the multinationals and other big ticket corporate houses are increasingly rewriting the market dynamics of Noida.
Many analysts call it the ‘next growth driver’ of property rally in this part of the world and while the horizontal growth is continuously stretching the boundaries, the vertical growth is also taking the market northwards in both volume and value. Collectively, Noida has been on the fast forward lane of development that promises to change the urban landscape completely in the next few years.
It has indeed been a long journey for Noida from being an affordable destination to the next ‘big’ investment destination. On a given scale of consumer/investor confidence index Noida would definitely score higher today, compared to Gurgaon or any other part of Delhi-NCR.
A number of studies suggest that Noida which has for long remained in the shadow of another glorified NCR city like Gurgaon is finally emerging as the global city with tilt towards developments that offer work-life-lifestyle balance.
The conventional wisdom of economics and property market also suggests that it is much better to look towards Noida than any other areas in and around Delhi-NCR. Reasons are many, from physical infrastructure to social infrastructure and appreciation potential to emerging economic opportunities.
This raises a fundamental question that if Noida has been pregnant with so much of potential than how come it always remained a relatively moderate property market of Delhi-NCR. More importantly, why Noida has emerged so late when in the property rally of 2005-07 some other destinations went to the peak level?
Analysts believe the blame partly goes to the way Noida was conceived and projected as an affordable zone and partly because the corporate sector looked towards Gurgaon due to its proximity to the international airport. In terms of the policies of the government also, Noida was not witness to hard sell by the government before the international investors.
However, Noida due to its strategic locational advantage and better physical infrastructure has been slowly but surely scaling up on the desirability index of the buyers, thus affordability giving way to desirability with value additions. What seems to have changed the market dynamics completely is the slowdown in the last few years added with the fact that Gurgaon property market was over heated and at its saturated point. This has forced the analysts to calculate their cost & benefit analysis in the Delhi-NCR market. With other Delhi-NCR regions not having the kind of quality infrastructure developments the way Noida has, it has only been a natural choice for everyone.
The investors are today conscious of the fact that the opportunity cost in the Noida market is tempting and the Return on Investment (ROI) much better than any other part of the Delhi-NCR. Even for the businesses, it is much more economical to do business in Noida where the capital value and rental cost per sq feet is relatively very moderate. And with the big businesses rolling out in Noida, the quest for luxury housing is also making inroads.
The young upwardly mobile working class with disposable income is today opting for quality luxury housing, lifestyle options and a healthy balance of work-life-lifestyle. This is increasingly throwing new challenges for the developers to cater to this class and customise their offerings to suit them.
The question is whether this shift that has been too late in the Noida market is sustainable. It is because already Noida has been late to blossom, feel the market trackers and analysts.
Nikhil Hawelia, Managing Director of Hawelia Group laments the fact that Noida has been a late mover, if compared with the possibilities that this market has. He asserts that despite of being developed as a world class destination, Noida still lacks luxury driven projects. With right understanding of the luxury buyers’ tastes & preferences, Noida as a market needs infusion of more high-end projects. Noida has great potential to become the next preferred destination for high end projects.
“Undoubtedly, Noida is today being preferred as a right market since it is an emerging realty hub with huge appreciation potential, compared to the saturated markets of Gurgaon. Physical infrastructure is amongst the best in the country, it provides supply of more quality living spaces and commercial property with competitive rentals inviting corporate interest in the region. Also, it is widely accepted now that the next wave of growth in Delhi-NCR will happen in and around Noida,” says Hawelia.
Gaurav Gupta, Managing Director of SG Estates feels that it is only the beginning of Noida’s march to quality high end projects. He feels the promise of the market is yet to be translated into performance and in the time to come this growth of Noida will stretch the boundaries of Delhi-NCR even further.
“Though Gurgaon has been the preferred market for luxury projects but of late some luxury projects have come in Noida too and they have got good response from the buyers. This shows that market is more mature in its understanding of the Noida as a key destination and its acceptability is increasing among the buyers. Noida is no longer considered the poor cousin of Delhi but is amongst the places which are in the category of the status addresses,” says Gupta.
Analysts feel it is the economic activity of the region that defines the direction of the property market. Now that the big ticket corporate houses are increasingly shifting their bases to Noida, the demand cycle will lead to supply of more and more quality projects. Already this shift is quite visible by the fact that most of the leading developers have got into commercial spaces in the Noida market. This is expected to further fuel the demand for quality residential units for the work force. An affordable zone is continuously shifting to work-life-lifestyle city.
