Riding high on the favorable government policies, abundant housing options and excessive land prices, property prices are pushing housing prices in Kolkata. According to industry experts, the land prices are going up by 50 percent in some of the posh localities in Kolkata. Catering to the huge demand for affordable residential options in urban and semi-urban areas in the city, Kolkata property prices are revising faster and better.
The property prices are influenced by the recent land auction by government bodies including, Kolkata Municipal Corporation (KMC) and Housing Infrastructure and Development Corporation (Hidco). Factually, KMC sold off a 2 acre plot on EM Bypass in June this year for 115 acres, which is the biggest land deal in Kolkata so far. The last such deal happened in 2009 when a 3.35 acre plot was sold off for 135 crore on EM Bypass. In fact, a 2.25 acre plot was sold for 51.13 Cr by Hidco in the IT township of Rajarhat. The land is meant for a retail-cum-office complex.
The Impact
According to city based dealers, the move will help the Kolkata real estate market to prosper further. There has been a disparity in the demand and supply equilibrium. The rising demand and increasing land crunch in Kolkata is hindering the pathways for emerging townships in the city.
The History
West Bengal has seen an abnormal rise in the land prices. In 2009, the government made huge gains by selling land in posh locations. In Kolkata, three major agencies including the Kolkata Metropolitan Development Authority (KMDA), Kolkata Municipal Corporation (KMC), and West Bengal Housing Board take care of the land dealings. According to published data, the three agencies collectively signed housing deals worth over Rs 18,000 Cr. for over 5.250 acres of land in a little more than two years. Moreover, it is believed that KMDA was accredited with signing deals, valuing more than Rs 800 crore with real estate developers on one day alone.
West Bengal is one of the few states that practice guarded land laws. The state has enforced the Urban Land and Regulation Act (ULCA) in 1976 which restricts the ceiling limit on vacant land in a category ‘A’ in the city to 7.5 cottah or about 500 square meters. Till today, no amendment has been added to the law however, the state grants permissions to relators for purchasing land beyond ceiling only if they provide 30 percent housing reservation for low-income segments.
Unlike the popular realty markets such as Delhi and Bangalore, the property trends are driven by consumers. As a result, the Kolkata market is enthralled by high demand and rising prices.
Source: siliconindia