Chennai real estate gains compared to other markets
Chennai: A hypothetical potential investor of Mumbai possessing a kitty of around Rs 100 crore and a desire to invest it somewhere, is left with option of only real estate as the present scenario rules out the stock market as well as gold. However, leading wealth and portfolio managers are increasingly advising their clients to invest within the realty market of Chennai, instead of the Mumbai realty market.
This occurrence is credited to the sharply falling yields of Mumbai. Thus wealth managers are considering investment within properties situated in localities such as Adayar, etc in Chennai. Adayar which is located in the southern parts of Chennai is also one among the southern city’s most expensive neighborhoods.
The locality has been supplying an impressive return on realty investment of a prodigious 110 per cent within the past five years. For illustration, if an investor had invested say Rs 2 crore within an apartment unit during 2008, the same unit would now fetch well above Rs 4.4 crore.
Adayar’s residential properties are expected to become even pricier over the next couple of years. Leading real estate market analysts have even better news; it is believed that the prices have not peaked yet. Property prices in many of these markets have softened by roughly ten per cent within the last six months.
Studying the portfolio reports of leading banks, it is clear that the city of Chennai is well ahead Mumbai. The reports also suggest that apart from being a consistent performer within recent years the city is expected to witness further boom.
The reasons behind Chennai’s success story:
The city has rapidly developed into a manufacturing hub.
The auto-mobile sector which comprises of car producers such as Hyundai, Ford and Renault-Nissan along with several other ancillary units have established there production factories here.
The city has absorbed massive investments from telecom as well as IT/ITeS industries, which has also created more investments opportunities within the city.
Local factors such as infrastructure growth increase in employment opportunities as well as levels of saturation and affordability.
Encouraging and conducive policies and efforts of the state government towards special economic zones.
Realistic real estate prices across Chennai too have helped in sustaining as well as increasing the demand from investors and end-users alike.
The real estate story of tier II and III markets like Kochi, Indore, Chandigarh, etc which hasn’t panned out well too are responsible in increasing the demand of the city’s realty.
Appropriate amount of economic activity which is playing out within the city is leading to high growth within both demand and prices of residential properties. Adayar is among several such micro markets around the country, where investors could chose to invest their money now and rake in the moolah when the tide turns.
