The residential real estate market in Kolkata is mainly end-user driven and has been less volatile as compared to other major cities in India. Majority of the demand in the residential market is in the affordable and the mid segment. During the first three quarters of 2012, approximately 7,600 units were launched in Kolkata, with most of the projects in the price bracket of Rs 3,000 to Rs 5,000 per sq ft. The new launches were concentrated in the peripheral locations due to affordable rates and availability of large land parcels. Despite steady demand from affordable and mid segment, the city is likely to witness stable capital values in the short term on account of high mortgage rates and rising inflation in the market. Buyers have been deferring their buying decision in the hope of a correction in property prices and brighter job markets.
What is the scenario in the eastern fringe of the city, that is, the areas of Salt Lake, Rajarhat etc?
Major activity in terms of planned residential and commercial development has taken place in the eastern micro-markets along the EM Bypass. Sector V, Salt Lake being a hub for IT/ ITeS sector, witnesses demand primarily from mid and high-income home buyers. During the first nine months of 2012, capital values in Salt Lake remained stable. However, with the ongoing discussions over legalising sale of leasehold residential plots, capital values are expected to appreciate.
Rajarhat is also a hub of real estate developments with major residential projects under construction by national developers. The location continues to witness high demand from mid and high-end segments.
However, due to the slow pace of infrastructure development most of the under construction projects have been delayed in this micro market. Capital values remained stable during the first three quarters of 2012.
There is a lot of emphasis on mid-segment housing in the area, are houses at Rajarhat still really that affordable?
Rajarhat is expected to become the second IT hub of Kolkata in the next few years. Average capital values for high-end projects in Rajarhat are approximately Rs 3,000 – Rs 4,500 per sq ft, while for mid-range properties, the price range is between Rs 2,400- Rs 3,000 per sq ft. These values are on a lower side as compared to the other micro markets within the city where average capital values are in the range of Rs 4,500- Rs 18,000 per sq ft (high-end) and Rs 2,800 – Rs 5,500 (mid-end) per sq ft. Recently, a number of affordable projects have been announced in the adjoining areas of New Town like Kali Park, Raighachi and Kalikapur areas falling under Rajarhat mouza. Developed by local developers, these projects are priced between Rs 2,100 to Rs 3,600 per sq ft. Rental values in Rajarhat are approximately Rs 25,000 to Rs 35,000 per month for mid segment projects, whereas for high-end projects the range is Rs 45,000 and Rs 65,000 a month.
Source: The Economic Times