Those looking for a pure investment buy will probably be tempted
by cities such as Mumbai, Delhi, Bangalore and Chennai which have
all undergone radical growth in the last few years. Indeed, the
country is urbanizing at a rapid rate of 2.5% a year. By 2015
India's 'Mega-Cities' of Mumbai and Delhi will be the world's 2nd
and 3rd largest cities.
Mumbai
Mumbai is generally regarded as expensive, especially south of
the city. Identified as the commercial and financial capital of
India and with a fantastic public transport network, no area is out
of reach and property is in high demand. Apartment prices in South
Mumbai are the equivalent of those in many of the world's leading
cities. A leading Indian real estate site (Magicbricks.com) offers
an idea of prices, with property in the western suburbs of Mumbai
costing from as little as £24 ($46) per square foot, to £727
($1,412) per square foot in southern Mumbai.
A degree of caution needs to be exercised when investing in
Delhi or Mumbai as severe price drops in residential property
prices occurred during 2007. That said, providing you choose your
development and area carefully, a profit can still be made.
Buyers would do best to invest in other rapidly developing
cities such as Bangalore in India's 'Silicon Valley' (Karnataka) or
Jaipur (Rajastan).
Bangalore
Bangalore is firmly established as a technology hub and its
economy is growing rapidly. Here, total demand for apartments is
estimated at 24,000 units each year, with an expected annual growth
rate of 20% over the next several years. Average prices in
Bangalore range from £217-£540 ($421 - $1,048) per square
metre.
Jaipur
Jaipur forms part of the 'Golden Triangle' of Delhi-Agra-Jaipur.
Popular with tourists, it is universally famous as the 'Pink City'
with stunning lakes, forts and palaces. It is also the site for
substantial IT and industrial development. To keep pace with the
business development there are a growing number of residential
complexes being created, with prices starting from £9,400 ($18,257)
on a complex of town houses and apartments, and from £23,194
($45,048) on a complex of villas that can be built to personal
specification.
Other fast moving cities include Chennai (Tamil Nadu), Hyderabad
(Andrhra Pradesh) and Pune (Maharastra) which are proving to be
highly attractive business locations, thus attracting residential
demand. IT and retail are key drivers of the real estate sector in
Pune and its transformation into a vibrant corporate city with
close proximity to Mumbai has made it a hot destination for the
real estate investor. Choice can vary across a plethora of new real
estate builds, with luxury apartments starting from as little as
£30,000 ($58,273). Top of the range property starts from
around £150,000 ($291,367).
Rudrapur
Rudrapur is expected to see huge amounts of growth in the near
future after the government designated it a Special Economic Zone
and offered tax incentives to encourage companies into the area.
With around 450 factories being built, the predicted work force is
expected to soon reach 300,000, with at least 50,000 expected to be
employed from outside the region. It is expected that those living
locally will also choose to move out of family homes as their wages
increase so demand could continue to grow for a number of years,
creating a solvent and sustainable investment opportunity.
Goa & Kerala
For buyers looking to pick up a second home for holiday use or
for the holiday market, the best letting opportunities are in Goa
and Kerala in southern India. With 100km of stunning beaches, over
400,000 tourist arrivals a year and prices that have risen over 25%
in the last 3 years, Goa is a hot destination for investors. The
Goan government is cracking down on rogue agents and sales to
non-Indians have to be reported to the government to ensure they
are legally conducted. Often nicknamed 'India for Beginners'
it is a delightful blend of east and west that has already
attracted some 5,000 foreign investors, 3,000 of which are British.
It is also rated as one of India's best states to live in and one
of the safest Indian regions, becoming increasingly popular with
retirees from the west. Kerala, also known as the 'Queen of the
Arabian sea', is a collection of islands and narrow peninsulas with
a warm tropical climate. The area has become increasingly popular
with tourists over the past few years and has a sustainable tourism
industry, almost year-round. Rental yields on Goan property are
estimated at around 6% - 8%.
In both Goa and Kerala, an apartment in a gated compound can be
a good buy. Remember that a sub-tropical climate can have a harsh
effect on buildings so buying into a serviced apartment block means
less can go wrong in your absence. Prices in Goa range the whole
spectrum, from cheap, individually sold apartments at £5,000 -
£20,000, ($9,712 - $38,848) to more expensive villas in gated
complexes starting from £70,000 ($135,968) and up. Recent 2008
reports from developers based in Goa have reported a thriving
resale market with increases of 40% - 50% over a 12 month period on
the sale price of an off-plan property.
Wherever you choose to buy, you will find India well supplied
with research resources. Indiaproperties.com for example, has a
regional market section which gives up to date information on costs
in different areas of major cities.
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