Propdaily : Fall in real estate prices in the Delhi-NCR is certainly a good news for buyers who have been deferring their purchase in the hope of more correction in the market, and this combined with the projections of better ROI on investment in upcoming NCR micromarkets like Neemrana and Bhiwadi means more cheer for those looking for their dream abode in the NCR region.
Neemrana is one of the key pockets along DMIC that has seen significant growth over the past five years, basically due to the favourable policies of the Rajasthan Government. and as a result there has been a steady appreciation in the property prices here over the past couple of years.
Fruits of infrastructure growth Infrastructure growth has been the key market driver here as most of the early bird projects under DMIC have been taken up in Neemrana. These include: 2,400 hectare Aerotropolis, a 70 km road corridor to connect BKT and Shahjahanpur-Neemrana-Behror (SNB) urban complex, a 40,000 acre Global City, 12.3 sq km Knowledge City, and 113 hectare Multi modal logistics park (MMLP) by CONCOR and RIICO.
Located on NH4 between Gurgaon and Jaipur, Neemrana which was once a weekend getaway for Delhi’s jet set, is now famous for its well developed Japanese investment region. It is fast emerging as a new hot spot for real estate investment in NCR according to a recent report real estate advisory service, PropTiger.com.
Sam Chopra, Founder & Chairman, RE/MAX India, says, “Located just off NH8 and in close proximity to other industrial hubs, Neemrana undoubtedly has become one of the fastest growing regions in terms of real estate growth. With huge investments coming from some well established Japanese firms like Mitsui Chemicals, Nissan, NYK logistics, Daikin etc and German and Korean companies coming up with their projects, Neemrana has moved from being the weekend getaway for people from Delhi to a blossoming business centre”.
According to the Prop Tiger report the prices here are likely to double in five years . “Neemrana will see a greater price appreciation because it is a more attractive location where planned development is expected”, says Dhruv Aggarwala, CEO, PropTiger.com.
Upcoming knowledge and urban infrastructure based global city is set to boost employment in Neemrana and drive in population in the region. This will give a further thrust to real estate growth with more projects being launched. Earlier also after 30 Japanese companies set up plants, apartment units launched rose from 1, 525 in 2012 to 6,754 in 2013.
Another factor that has contributed to price appreciation here is the greater demand from expatriates than the current supply here. Due to this the prices are more than those in the neighbouring Bhiwadi area. “Unlike Bhiwadi, real estate in Neemrana consists primarily of plotted developments. Due to expatriate population and undersupply, apartments in Neemrana are priced above those in Bhiwadi despite being at a greater distance from Gurgaon”, says Aggarwala.
The influx of workforce and executives and increased demand have led to a 6 per cent appreciation in prices here in the past two years. This is in spite of the fact that since 2014 Q1, sales have dropped by 68 per cent, though inventory overhang is healthy, at 22 months. As much as 78 per cent of the unsold inventory is less than 2 years old.
Almost 55 per cent of launched units in Neemrana are plots. The ticket size is often below Rs 25 lakh, with apartment prices ranging from Rs 1,950 to Rs 4,200 per sq ft.
Only 19 per cent of the projects and 20 per cent of the apartment units are “ready to move in” here.
Investors who wish to hold on to their property investments for over five years will find Neemrana giving them a high ROI because most projects will be ready in 5-7 years.
Effect of positive policies
Some of the policy initiatives driving affordable housing in these regions include: waiver of cost of external development, agricultural land use conversion charges and building plan approval fee. Rajasthan Government has also introduced a single-window clearance system to reduce time and efforts involved in various clearances and approvals of layout/applications and serve as a single-point interface between investors and various governments.
Total Projects 21
Supply till date 7,245
Unsold Inventory 1,869
Weighted AVG Price 2,950
CAGR in supply (2012-1014) 27%
CAGR in absorption prices (2012-1014) 1.5%
Supply till date 7,245
Eldeco, Ashiana Housing, Zone Ashadeep Group, Avalon Group.