What we call the ‘city’ today could in the future be the ‘old town’, says Sonal Sachdev
The best place to live today may not be the best place to live tomorrow. Many of our cities have an area we refer to as the “Old City”, usually identified with narrow and busy streets, old buildings and traditional centres of commerce. Most people wouldn’t think of buying a home in these parts today, even if available at an attractive rate per square feet. The same people, if they had been living 50 years ago, may have craved for a home in these parts.
All urban centres go through such phases of evolution, whereby “the old order changeth yielding place to new”. In Mumbai, the towers of Nariman Point stare at you with hollow eyes, even as Bandra Kurla bustles with activity. Connaught Place in Delhi is today a poor cousin to Gurgaon. The list goes on. Such shifts in cities don’t happen in a few years. They take decades. But the sands do shift, and what was once coveted is no longer sought. It therefore makes sense to buy a home with a 20 year loan only where you wish to live 20 years from now and thereafter.
Note that property prices don’t always keep going up. When a locality and its buildings get old, the realty values tend to drop. People often crave better infrastructure and amenities, which often due to space constraints can’t be provided in old residential areas. Factors such as these can spark a shift, but the more influential drivers are usually infrastructure developments—better connectivity, a flyover, a metro subway, a sea link, a new airport or railway station.
The new airport in Bangalore has fuelled development in Devanahali and other areas en route to the city. The new airport in Delhi has seen Dwarka and Gurgaon emerge as sought after home markets. The proposed airport in Navi Mumbai, along with the planned trans-harbour link, could kick-off a similar trend in Mumbai region.
For home buyers, taking a holistic view on how their city is shaping up is important before they take a decision to invest their savings. While issues of a personal nature may influence home buying decisions, an evaluation of the macro picture is no less important. Today, for instance, the passage of the new land acquisition law can push up prices of large tracts of land and exert upward pressure on realty prices. The law, requiring consent of 70% of land owners for public-private projects, can also delay or indefinitely stall infrastructure projects. For home buyers looking to benefit from access to such infrastructure in future, it is time to re-evaluate their plans.
Waiting for infrastructure
Mumbai: Navi Mumbai Airport; Mumbai Trans-Harbor Link
NCR: Eastern Peripheral Expressway
Bangalore: NHAI Highway from Devanahali Airport to Bangalore
Chennai: Metro Rail