The demand for one bed room, kitchen (BHK) has been on
increase; the developers over the past few months have launched or are
launching several residential projects in the south and north Bangalore
Industrial areas. With the proper and reasonable pricing to the properties with
1BHK flats, the situation in the real estate market is likely to improve in the
coming months.
In view of the high costs of projects, the affordability
to buy 2 or 3 BHK flats in such projects has gone down to some extent. This
might have caused large number of already developed flats in the past few
years, lying vacant for a considerably long time. During recession period, real
estate market was badly affected and as such there was a down trend in the sale
of apartments. Added to this situation of 'No mood to buy', inadequate
infrastructure and poor connectivity also affected the real estate market of
Bangalore. However, the situation seems to have changed now in view of many
infrastructure projects taken up by the various local authorities of Bangalore.
Bangalore is changing fast. Projects for widening of
roads all around the metro, strengthening of city transport by adding large
number of buses, construction of under/over bridges, construction of sub-ways
are all in progress. The most eagerly awaited ambitious project 'Metro Rail' is
scheduled to commence its runs by 2011. The metro rail project will certainly
improve the connectivity. Better connectivity will also help the real estate market
to improve. The much improved connectivity and good infrastructure will be a
boon to the real estate market.
With the reduction of the size of flats to one BHK, the
prices of flats have come down. There seems to be healthy improvement in the
number of buyers of the reduced sizes of flats. The demand for such single BHK
flats being high, the developers may even think of letting out the unsold flats
on rental basis in case sufficient buyers are not found. This will not only
help the people desirous of occupying flats on rental basis but also developers
for getting some returns on unoccupied flats. The demand for residential
accommodation will, to some extent, be met.
The demand being more for smaller units with one BHK,
what will happen to the already developed properties with more than 2 BHKflats? The developers are offering various incentives for their properties and
expect that they will be able to dispose of a good number of such flats in the
coming months. However in the absence of data about the vacant units of the
developed properties, it may be difficult to know about the actual number of
unsold units. All efforts will have to be made by the developers to persuade
the prospective buyers, for disposing of their developed flats, instead of
keeping them vacant by offering all possible and practical concessions like
deferred payments, affordable EMIs etc. in prices instead of offering various
luxurious benefits.
With the availability of comparatively easy funds by way
of loans at lower rates of interest, lowering the sizes of apartments from 2
BHK 3 BHK to 1 BHK, lowering the property rates by correcting the price
structure, improvements in the job market, it looks like the real estate market
may show some improvement in the coming months. However one will have to wait
and see what will happen in the coming months. We may have to look for some
concessions forthcoming for the badly hit economy of the real estate industry
in the ensuing State/Central budget.
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