Announcement of several infrastructure projects by the Chief Minister and inauguration of the second phase of the Metro, has improved the investor confidence that saw leading to a 1% rise in weighted average price of Chennai’s real estate during the quarter, revealed Magicbricks PropIndex, the most awaited quarterly real estate report, for April-June 2017.
Magicbricks PropIndex for Chennai captured the price movement across 41 prominent localities, which were selected on the basis of high share of consumer preference as well as actively traded properties. The report also revealed that there was a price rise in63% of the localities in the Chennai market.
The Chennai market has been stable over the last few quarters without any major fluctuations in the city average price level. This trend continued in the Apr-Jun 2017 quarter. Most of the core and peripheral localities witnessed marginal price increment with the highest price increment of 2% being observed in the Rs 5,000-6,000 per sqft bracket. All major localities in this price bracket towards South-West, West and North-West of the city witnessed price increment. This segment consists of major localities like Kolathur, Porur, Pallavaram and Chromepet. Many prime suburban areas and their adjoining localities towards the southern part of the city saw price decline
Mr. Sudhir Pai, CEO Magicbricks said, “Chennai market has been stable over the last few quarters without any major fluctuations in the city average price level, but this quarter has witnessed increase in prices by 1%. General lack of political stability has put large investments in the Chennai real estate market on hold but with the announcement of several infrastructure projects by the Chief Minister and inauguration of the second phase of the metro, the real estate market is expected to pick up as investor confidence in the market improves.As market continues to adjust with the implementation of recent policies like RERA and GST, consumers are expected to be on the wait and watch mode. In such a scenario, tool like PropIndex acts like a major devise that will help consumers get a fair idea about the changing times.”
Magicbricks PropIndex also reported that the two entry-level budget segments between Rs.3,000-5,000 per sqftbracket, they account for 48% of consumer preference and 59% of listed properties on Magicbricks. This segment has seen negligible price movement in the Apr-Jun 2017 quarter. It can be deduced that transactions in this segment are still on the lower side. The highest budget segment (Rs 11,000+ per sqft) however has witnessed marginal price increment.
Comparison and analysis of Under Construction (UC) properties and Ready-to-Move-in (RM) properties across 41 localities shows that on an average (UC) properties are more expensive than (RM) properties in the quarter. While the weighted average price of RM properties was Rs. 6,128 per sq. ft., the same for UC properties in the quarter was Rs. 6,868 per sq. ft. Overall; more localities had increment in price of RM properties while more localities had decline in price of UC properties. Average price increase in price of RM properties at 2% was higher than average price increment of 1% in case of UC properties. Rs.8,000-11,000 per sq.ft, budget segment saw price increment in both RM and UC properties. This is the fourth quarter running where the gap between price of UC and RM properties has decreased.
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