As the residential real estate market is poised to recover throughout the year, many NRI property investors are considering their options when it comes to deciding what to buy, and just as importantly, where.
We reveal the top ten residential real estate markets in India that are poised to provide NRI real estate investors with maximum returns.
Exceptional educational institutions, a booming IT industry, strong infrastructure and a high rate of migration make Bangalore a primary investment destination. The launching of over 21 residential projects in 2013 means real estate investors have plenty of choice when it comes to selecting the perfect property. The residential sector is off to a strong start in 2014, with properties earning between 3-7 per cent in capital appreciation quarter-over-quarter.
Having long been one of the fastest growing cities in India, Ahmedabad is a prime spot for investors looking to seize on the potential for substantial price growth. With a strong economic forecast in place, the city is expected to reward buyers with immense price growth. Historically, real estate investors have been able to make as much as 20-25 per cent over a four year holding period.
Goa’s popularity as a holiday destination has in turn made it a popular destination for property investment, with the market seeing strong investor activity in recent years. The average apartment price in 2013 was around Rs 70 Lakh, but Goa isn’t just a market in which investors can make money from price appreciation alone. The strong rental market (with rental yields around the 5-10 per cent mark) means investors can enjoy income generation in the short term as well as price growth in the long term.
Thane’s real estate market has stepped out of Mumbai’s shadow once and for all, with economic development and a strong employment sector bringing people to the area. Q1/2014 saw capital values rise 4 per cent in the high-end sector to Rs 10,000-19,000 per sq. ft., and remain stable at Rs 6,500-10,000 per sq. ft. in the mid-end market. With developers on a land buying “spree” and Thane being home to 15 per cent of the new developments launched in Greater Mumbai in Q1, NRI property investors have plenty to be excited about in this beautiful city.
Navi Mumbai has been perhaps one of the strongest residential real estate markets in terms of price growth over the past five years. Between 2009 and 2013, residential prices soared by roughly 85 per cent. With infrastructure developments planned along with a number of new property launches in 2014, this sub-market is set for another strong year. Q1 capital values spanned a large range between Rs 8,500-17,500 per sq. ft., proving that when it comes to finding a lucrative deal, research and individual analysis of each property is key.
A comprehensive City Development Plan is in place, which will in turn bolster the demand for housing in Pune. Developers are already responding to this anticipated growth, launched almost 4,000 units in Q1/2014 alone. An estimated 80 per cent of these launches were in the mid-market range, and with both rental rates and capital values expected to rise later in the year, the residential real estate market is set squarely on a trajectory for positive growth.
Greater Noida was property firm Jones Lang LaSalle’s top pick as an investment destination in 2013, on account of the high returns on investment buyers can expect here. The Noida Expressway in particular is an area set for expansive growth, and with transit and infrastructure improvements also planned, real estate investors can expect to earn a substantial sum in capital appreciation on a property purchased here.
The realty market in Lucknow has seen something of a rebirth in recent years, with many market experts crediting the development of the Lucknow Metro rail. Along with much-needed improvements to transit that will increase the city’s connectivity, there are a number of pre-construction and new properties arriving on the market to satiate investor appetite. Statistics reveal that last year, roughly 80 per cent of the residential stock in Lucknow was purchased by real estate investors.
Property development is on the up in Mumbai, with just shy of 11,000 new units being lunched in the first quarter of 2014 – double the number of units launched the quarter prior. Rental rates have remained consistent throughout the city, and capital values in the city’s central suburbs are reported at Rs 8,000-11,000 per sq. ft., up 3 per cent year-over-year.
From 2009-2013, prices in Chennai appreciated by 53 per cent. Despite high activity from end users, the property market poses many lucrative opportunities for NRI property investors. A busy IT hub, Chennai is set to receive improvements to major transit links and infrastructure, including the Outer Ring Road (ORR), which is a particularly up-and-coming area in terms of residential real estate.