Varanasi Witnesses Increasing Seekers for Property

Varanasi has currently become a real estate hotspot on the map of Indian realty sector, due to various factors in recent times. As such, there has also been a growth in demand for housing in the city. Data obtained from CommonFloor supports this trend of increasing number of property and rental seekers in the city.

Drivers of Varanasi real estate

Varanasi’s real estate has witnessed a boom in recent times and has made it mark on the country’s real estate map. There are a series of factors that are driving its realty.

1. Varanasi’s real estate came into spotlight during this year’s general elections. Later, the new government at the centre announced Varanasi as a smart city. This further boosted the real estate sector. The recent announcement of the country’s prime minister, Narendra Modi, to turn the city into a heritage centre acted as a crown jewel for the city’s real estate sector.

2. The local authorities and civic bodies in Varanasi such as Varanasi Nagar Nigam and Varanasi Development Authority have planned several infrastructure projects in the city. The Varanasi-Lucknow Highway (NH-56) is being widened into a 4-lane road while the Varanasi-Aurangabad section of NH-2 is being widened into a 6-lane road. The Varanasi Ring Road is undergoing rapid development. The prime minister has also taken an initiative to clean up the Ganga ghats. All these infrastructure projects are driving the real estate market here.

3. The tourism and hospitality industries here are also important growth drivers. Varanasi has a prospering tourism industry as the city is an important cultural centre. Mr Modi recently signed a partnership agreement with Japan’s prime minister, focusing on preserving the heritage of the city in parallel with developing it as a smart city. This is expected to boost the tourism and hospitality industries further and consequently, the real estate market.

Real estate witnessing demand

As a result of all these factors, Varanasi is witnessing a growth in demand for real estate. According to agents and local developers, the city’s realty sector is currently attracting a good number of investors from all over the country who like to invest in residential plots, apartments and villas.

A recent data obtained from CommonFloor, shows that the realty sector has witnessed a significant growth in the number of seekers for both purchase as well as rentals during the third quarter of 2014. The following graph gives an idea about the percentage growth in the number of seekers looking for property in Varanasi.

Fig 1: Number of seekers over last four quarters (Source: Real insights by CommonFloor.com)

From figure 1, one may see that Varanasi’s real estate had a good number of seekers during the final quarter of 2013 for both rentals and purchases. But the first two quarters of 2014 witnessed a sudden decline in demand. This was due to the onset of elections and prevailing uncertainty among buyers. But once the elections were over and the new government was formed at the centre, the city’s real estate witnessed a sudden increase in the number of seekers for both rentals and purchases. In fact, the total number of queries during Q3 of 2014 almost doubled compared to Q4 of 2013.

The following figure gives an idea about the percentage seekers for rentals and purchases.

 Fig 2: Percentage distribution of seekers over four quarters (Source: Real insights by CommonFloor.com)

One may also see from the above figure that rental properties too have been gaining more seekers over the last few quarters. The higher percentage of seekers for rentals during the first two quarters of 2014 was during the election season, where there was uncertainty and also due to an influx of tourists. Though the percentage for rentals in the third quarter of 2014 was lesser than that of previous two quarters, it still grew with the overall increase in queries for properties.

One may draw inference from the available data that the real estate market in Varanasi has indeed witnessed a boom and the good days for Varanasi’s real estate may already be here.