Ahmedabad stands out as a city that weathered the market slowdown most smartly and the property market of the city was the first in the country that showed signs of recovery by June 2009 itself. Since then realty in Ahmedabad is back and booming, with nearly 35% appreciation.
The office market is likely to observe steady demand, especially in prime locations in leading cities like NCR, Mumbai and Bengaluru.
During the economic downturn of 2008, while the other neighbouring and glamorous property market of Bangalore and Hyderabad fell by 24-29 per cent, the Chennai market fell only 8.3 per cent. Limited supply of land and pent-up demand is how NHB’s Residex defines Chennai property market.
Global financial uncertainty, shrinking demand, liquidity crunch, repo hike and demand-supply mismatch…all is not well with the commercial real estate in India.
Market forces of demand and supply are the most potent determinants of price and the developments in the real estate industry during year 2011 is the latest example.
Through the course of 2010, the realty sector evened out into a level playing field, with enough traction in the market to hold investor interest, with several on-going projects being delivered and others being launched.
In a further blow to the dampened Diwali spirit of the realty sector, the RBI raised interest rates on today but said it was likely to hold off on further increases as it expects high inflation to ease beginning in December.
Foreign direct investment (FDI) in the real-estate sector last year was the lowest in four years, but private equity activity gained momentum during the recent months, according to a study by an Indian industry chamber and a global accountancy firm.
The Indian real estate market has matured to the extent that it is seen as the best investment instrument, leaving behind gold and other traditional investment options.
Unitech Ltd is expanding its retail development business and plans to invest around Rs.2,000 crore over the next three years to develop about 2 million sq. ft of premium and luxury shopping malls.