City records 39.5 per cent jump in the last quarter; over 200 per cent increase in last five years
If anyone had doubts about Chennai being a boom city, the National Housing Bank's Residex index, which has been tracking housing prices in different parts of the country since 2007, puts them to rest. The index for the city leapt up by 39.5 per cent in the last quarter [January to March 2012] of 2011-12 compared to the same period last year [January to March 2011]. This is the highest jump for any city for the period.
In Bengaluru, in contrast, the index for the same period has gone up by just 4.5 per cent, while in Hyderabad the growth has been even slower at 3.6 per cent. In Kochi, the only other city in south India to be tracked, the growth has been negative: minus 16 per cent, the lowest for any of the 15 cities which are being monitored across the country on a regular basis.
Delhi clocked a robust 32.5 per cent growth, the second best, followed by Pune [22.3 per cent], Bhopal [22.15] per cent, Jaipur [19.4 per cent] and Surat [12.4 per cent].
Mumbai registered a growth of 8.6 per cent and Kolkata had a slump, with the index registering a negative return of minus 9.5 per cent.
Lucknow recorded a growth of 4.5 per cent, while Patna had a slump, registering a negative growth of minus 13.4 per cent. In Ahmedabad, the index has fallen marginally at minus 0.6 per cent.
Releasing the latest data for January-March 2012 quarter, the National Housing Bank said from January 2012, NHB-Residex has been expanded to cover Bhubaneshwar, Guwahati, Ludhiana, Vijayawada, and Indore, taking the total number to 20. Interestingly, all the five cities have shown a robust growth in price over the past five years. In Indore, the prices have more than doubled – from the base of 100 in 2007 to 208 during January-March 2012, while it has increased by 84 per cent in Vijayawada, 63 per cent in Ludhiana, 61 per cent in Bhubaneswar and 57 per cent in Guwahati.
In contrast, only nine out the 15 cities crossed the 50 per cent mark during the five-year period: Chennai [204 per cent], Faridabad, on the outskirts of Delhi [117 per cent], Bhopal [104 per cent], Kolkata [91 per cent], Mumbai [90 per cent], Pune [81 per cent], Delhi [68 per cent] and Ahmedabad and Lucknow [64 per cent each].
Of the rest, Surat and Patna had a positive growth of 44 per cent and 29 per cent respectively, Bengaluru had a negative return of minus 8 per cent, Hyderabad minus 14 per cent, Jaipur minus 20 per cent, and Kochi minus 28 per cent.
Keywords: National Housing Bank, Residex index, Chennai real estate, property value, construction activity
This article may have facts but this is not by any means a full picture. There are several properties which have been bought and owners are waiting for tenants. This is just part of the fact. With the jacked up price in Chennai, what you get for what you pay, it is not worth it. I agree with most of you. The infrastructure, water, power, name any thing that will make a persons life easier are not there. And yet the prices are artificially jacked up only to favour those who are filthy rich. Can an employee/government servant or any one who is making a decent money by helping Chennaites afford to buy a dwelling in Chennai? Shame on us, shame on our politicians and the media for propagating partial pictures and not showing the reality. These properties will stay and prices will come down as there will be no one to buy.
Sorry. There is no need for this housing price bubble. It will all come crashing down at some point in the future. Chennai has become a dump. Woeful infrastructure, intolerable weather and high pollution is not the recipe for prosperity.
Chennai is often spoken of as cultural capital of India. With shortages of water and power and roads, the city presents a dismal picture of near anarchic conditions. If statistics speak of a different picture, it is hard to believe. With apartments and gated colonies, the once congenial social relations have transformed into morbid aloofness. Urbanization brings its own costs. City must wake up to avoid pitfalls of this and work to deserve its name of cultural capital.
The EMI that we pay for the loan and the rentals that we get as income for the same house don't match. The rental is 6 times less than EMI. Therefore it is illogical to invest in real estate. Another point is usage of unimaginable black money. This "growth" will come to an end (on the head of builders only) considering the "growth" of inflation. There is an impending burst.
Can anyone see "bubble" written all over this "growth"?
What ever the statistics mentioned in article is correct, especially in
Chennai Housing rate is going very high,its all because of growth in
lifestyle and salary of Chennai people. No builder is ready to increase
their property price without a good demand.All properties in Chennai with
high price are moving well. one main thing to notice is ,builders are
making only delay in property handover, not in selling the property.They
sell the units within the estimated period.According to the stage of constriction they increasing the price, that not only a increase of their
property, its a increase of area rate. so builder starting a new project
starts from price coated by completing project, then they start to
increase stage by stage. If any builder is odd from this practice,people
think there is some problem with that particular builder.
All this happening in acceptance of people only.Builder go by this practice unless until people wake up.
I have a very serious question, is the right time to invest in a property or wait for this insane growth bubble to burst. After consolidating a little amt I am on the lookout for purchasing a flat but the rates are exobirant and the real estate people are telling it is still going to increase another 25% in the coming year. I am really confused, in case of investing now or wait till the bubble bursts, but the only question is how long?
I saw Chennai 30 yrs ago, today...my conclusion ABOUT CHENNAI IS THE SAME DIRTY AND FILTY PLACE TO LIVE IN! Everybody wants to cheat to live giving inflated figures about the real value of the housing. I wonder how Chennai residents claims a good place but surrounded by unbeareable pollutions. Rated as one of the world's filthiest cities I have been!
Present housing prices in Chennai are overvalued and is not of real worth. The prices does not reflect the actual quality of life in Chennai. One other reason that prices are shooting up is that citizens from rest of Tamilnadu are investing in Chennai housing proactively for their kids future.
i fail to understand why people are crazy about chennai. it has worst climate in the whole of india, it has filthy roads. congested shopping areas. freeezing cold theatres, unclean restaurants and the rude people. even temples which used to be quiet and calm are greedy now, the priests take just 10 seconds to perform your archana.
I agree with the comment made by Harikrisha... Prices may be hyped but the infrastructure provided by Chennai coporation and urban develpment authority are worst. Its a very worst place to stay... Visit Korrutur Balaji nagar for example... In the rainy season you will have to walk only in Mud and water... U can't see the roads at all. Water facilities, drainage and many basic eminities in Chennai are horrible. Especially the people of that region show inequality to people from other places of the country...
this is another area that is controlled by the politicians and their henchmen to plunder the country and make money
- yes the city is the worst place to live in the world - with the worst traffic, heat and no electricity and people do not have the guts to vote any other party other than 2 and not revolt and be complacent and be beaten up by the politicians in all possible manner and have the attitude of a typical indian - i do not care - as long as i get my food on the table - guys wake up - have some social responsibility - do not be selfish and this country is diving into deep trouble - it will ultimately impact you also - follow Egypt and bring in a change
It is very sad to see the city growing like this, after many years I landed in chennai, not only shocked at seeing the grades of growth but worried for people who have to put up with loss of water storage areas, greens and poor infrastructure.
I am very saddened for the common man, how can they afford to live in this city and that too with very poor life style and quality. Real estate agents and politicians are so greedy can't believe they are creating serious mess and hell for the future generations to come. Why can't the authorities take issues seriously such as creating infrastructure to bring in good water from near by areas besides like every one feels move all important offices out of the city, like they do in The UK and Australia. Will our politicians let our people live with some dignity and allow India to exist for our future generations.
People should be self aware before making an investment. Not only because of the promoters, also people are unclear about their investment. If nobody is ready to buy, prices will automatically come down.
This level of real estate boom is NOT 'growth'. It is a greed-and-dope-sustained bubble (I say 'dope' because gullible people who have cash/loan eligibility are literally doped by brokers,promoters & builders into thinking that throwing that cash into RE is going to return them double the amount in 2 years). This overvalued RE has already made decent housing out of reach of common, salaried folks. Only hyper rich, black moneyed people can have the luxury of owning a house (rather, several houses) and letting them out for exorbitant rent. This is like going back to the dark medieval age, not growth, seriously.
yes Chennai grows and growing is good but unless there is infrastructure
and people living improves their discipline particularly with regard to
permanent parking of vehicles on the roads blocking traffic,
littering,spitting and mainly not permitting mini marriage halls in
residential localities as they pollute atmosphere with sound, pheromones
etc. and also hurting sentiments (none in Chennai likes nagaswaram in a
sorrowful situation!!!)the Tamilnadu government is choking public to
death.
The drive from SRP to Velachery yesterday made me feel like hell being in Chennai. The real estate prices are going high and parallely the infrastructure are becoming more worse. The road is being constructed for the past few years and is still in construction phase without much improvements. It is a great nuisance for thousands of people everyday using the main link to the city and IT hub.
Traffic and additionally now the hot summer on top of this poor roads, which pours all dusty air for us to inhale.Now question is whether we are paying the highest amount for all these ? do we have any luxury in our living just buy paying the wholesome amount which we had to pay back thro EMI for our life time ??? Is the city a real worth ??
I am Scared, where this would end up. Why cant the government do the necessary to expand the tier 2 cities. The Government dont want to act on it, for the known reasons.
Chennai is still cheaper than many cities. Compare rents in bangalore u will find much cheaper. Even with increase in tariff the bus charges are cheaper than other metros. Roads are wider than bangalore. With people in chennai earning almost global salaries its obvious rents and prices have to shoot up. People are not complaining of busying a Mobile for Rs.25000. Why cant they buy a flat for Rs.50 Lakhs
Try to diversify the city where we live in .Expand tier-2 and tier-3 cities.We may have more green space and less congestion in the City.Make the city an 'Art to live'.I wonder the greedy real-estate entangled with the politicos will accept the industries and developments to come to smaller cities.It will balance the price and the Eco-system where we live else we may choke in the metros.
I don't think anyone will believe in all these statistics seriously.
Chennai might be growing rapidly, real estate prices are booming, but
the city is fast becoming an place unworthy to live. This place is
becoming a hell and in several parts of the city even basic infrastructure is inadequate or completely broken. The real estate is
booming only due to the greed of the real estate promoters(also
brokers) and the ignorance of the buyers. In many places the price of
properties not even worth a fraction of its price. This is an unsustainable/artificial growth and the bubble will bust very soon.
The growth seems to be unrealistic, given the infrastructure and other facilities especially in the suburban regions. Most of these housing projects have a lot of empty apartments sitting with no tenants or occupants. There is also a sudden increase in supply of houses in OMR, GST, Sriperambudur belts and all investors (especially NRIs) are buying in the pretext, they can get rent out of these properties which has not been the case. I really pity those owners who actually move
into such desserted communities/ township paying for high maintenance and lacking basic amenities which were initially promised. 10 - 15 yrs down the line I fear, there is going to be a scenario similar to the US housing market, where in there will be desserted communities and foreclosed homes.
Its good to see chennai is growing. But please extend the city so that people will be able to get acess to affordable housing.
It is only facts from the fact sheet or data sheet than an Article.It is
an disappointment for all the chennai residents who wanted to know the
details of this article.It does not take a lead in discussing the
causes,predictions of this surge in price.
this is ridiculous. with no infrastrutre and proper growth, the property prices increase because of scarcity caused by land grabbers and politicians
It is good news for home owners and hope this growth is supported by parellel growth in the city infrastructure and we hope it will be the city to live in 2020 and reaches a significant impact on the global picture.
Happy chenniate--hope the temperature dips down a bit and we have a clean fresh air all around
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