Gurgaon scores over Delhi as real estate destination

A recent survey has concluded thatthe construction of the Metro has boosted investment sentiments

February 02, 2016 12:00 am | Updated 07:10 am IST

The Millenium City has emerged as the most attractive real estate investment destination, followed by Delhi, Noida, Faridabad and Alwar, according to a recent study on ‘Determinants of real estate: A survey of Delhi NCR’.

Conducted by the Research Bureau of the PHD Chamber of Commerce and Industry, the study explored transport connectivity, existence of employment opportunities and availability of social infrastructure including schools, colleges, hospitals to identify destinations considered attractive for real estate investments.

According to the study, the development of the Metro has resulted in widening choices for investments in real estate. The study revealed that Metro construction has not only boosted investment sentiments, but also led to increase in prices of nearby property.

The survey said that price is the most important factor while considering investment in real estate, followed by construction quality, proximity to the Metro, gated community, brand name of the builder, corner plots, availability of loans, power and utility back, vaastu compliance, locality, legal payments, future prospects of the place and rent receivables.

The study stated that the source of information about real estate investment avenues is largely through personal contacts such as family, relatives, friends and colleagues. Real estate brokers, agents or dealers, newspapers, magazines, hoardings and SMS alerts have also publicised investment opportunities, while other means of marketing like online social networking, internet and television are also being used increasingly to publicise real estate projects, the study added.

The key reason, the survey said, for buying properties in Delhi NCR is residential purposes, followed by earning decent returns on investments, buying commercial space, rent or lease, retailing, gifting and warehousing, said the study. The survey also highlighted the factors affecting real estate investment sentiments, which include high rate of interest on loans, followed by inflationary pressures in the economy, lack of demand and economic uncertainties. It also reveals that investors have apprehensions about submission of registration fee prior to non-completion of projects. Also, they say that non-completion of projects leads to emotional harassment in the form of legal cases and financial loss. The new Real Estate Bill 2015 is expected to protect the interests of consumers, promote fair play in transactions and ensure timely execution of projects.

Mahesh Gupta, president of the PHD Chamber of Commerce and Industry, has in fact urged the Central government to consider a deduction of up to Rs.5 lakh from the current Rs. 2 lakh for interest paid on a home loan on a self-occupied house, while calculating the taxable income in the forthcoming Union Budget to boost the demand in the housing sector.

Enhanced deduction to the level of Rs. 5 lakh would provide a significant fillip to the economy and enhance India’s GDP by another 2 percentage points, and so will be the level of enhanced revenues of government, said Dr. Mahesh Gupta. Further, decelerating prices of international commodities such as crude oil, steel and cement can be capitalized to boost the construction sector and build a strong India, he added.

A study says that

the construction

of the Metro has boosted investment sentiments

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