MMR, Bengaluru and Pune are currently the top three markets for buying homes for end-use and investment. The IT/ITeS sectors' post-COVID boom has worked well for these three markets, a report has said.
Data shared by Anarock indicates that these three cities remained the most active markets in 2020 – together accounting for a 67% share of the total housing sales (of approximately 1.38 lakh units) recorded in the top 7 cities, and 60% of all new launches (approximately 1.28 lakh units).
Interestingly, Bengaluru and Pune, respectively, have also been declared the top two most liveable cities of India in the recent Ease of Living Index published by the Ministry of Housing and Urban Affairs (MoHUA). This coveted title further reinforces their attractiveness.
Pune saw average property prices rise by 38% in the last 7 years – highest among all top cities
Prevailing developer discounts, lowest-best home loan rates and limited period stamp duty cuts make these markets lucrative for long-term investments. As per ANAROCK research, Pune's average property prices stood at Rs 3,980 per sq. ft. in 2013. This increased to Rs 5,510 per sq. ft. in 2020 (a 38% jump).
Bengaluru saw its unsold stock decline by a massive 51% in 2020 as against 2016 – from 1.21 lakh units in 2016 to nearly 59,330 units as of 2020-end. As per ANAROCK research, the average property prices in the city currently hover at Rs 4,955 per sq. ft. - which is far more affordable than most other top cities, the report said.
“Given the ongoing uncertainties in the stock market and financial sector, housing is currently being viewed as one of the safest long-term investment bets," says Prashant Thakur, Director & Head - Research, ANAROCK Property Consultants.
"While the stock market prices are at their peak, property prices have bottomed out and various offers and discounts result in further reductions in acquisition costs. Affordability of homes in top cities is also at its best – estimated to be 27% in FY21 as against 53% in FY12,” he said.
MMR's real estate market remained active in 2020, despite the pandemic. Its unsold housing inventory declined by 6% - the highest in 2020 as against the previous years. In the previous seven years, MMR's stock either increased y-o-y or declined by no more than 3%. Additionally, the ongoing infrastructure projects such as multiple metro links, Mumbai Trans Harbour Link etc. make it a favourable investment destination.
In the current pandemic times, MMR's property prices have bottomed out. The limited-time stamp duty cut and lowest-best home-loan rates are other added benefits. The cost of property acquisition in MMR has reduced by anywhere between 5-15%. The recent limited-period 50% reduction in construction premiums may further help property prices reduce by 5-7%, the report said.