Last stretch of Chennai Metro Phase 1 becomes operational
The 10 km metro stretch between AG-DMS and Washermanpet became operational in January 2019. Apart from reducing the travel time between Washermanpet and the Airport, the development is also likely to improve housing demand in the areas located along the metro corridor.
Infrastructure development on the cards
In State Budget 2019-20, the Tamil Nadu government announced a slew of infrastructure development projects including the implementation of the Intelligent Transport System, development of comprehensive parking management system, restoration projects of Adyar and Cooum, Chennai Mega City Development Mission, solid waste management projects, and construction of 38,000 tenements for the poor. The projects are likely to boost realty prospects across several regions of the city.
State approves Common Development Rules
The State government approved the Common Development Rules for Municipalities, Municipal Corporations, and Town and Village Panchayats. The move opened prospects for commercial development along the roads with a minimum width of nine metres along with facilitating single window clearance for construction projects in the State. Further, to curb illegal constructions in the city, the State mandated multiple checks during the construction of high-rise buildings.
Government approves CRZ norms
The Environment Ministry gave a nod to the State’s draft policy of Coastal Regulation Zone norms (CRZ). The move would facilitate construction of permanent structures up to 50 m from the sea, and temporary structures up to 10 m from the sea, subsequently boosting development along the coast.
Chennai’s realty landscape continued reeling under subdued buying sentiment in Jan-Mar 2019. Sales volume increased by a marginal five percent, QoQ. New launches, too, remained minimal in the wake of factors such as the NBFC crisis, acute paucity of sand and the anticipated revision in the GST regime. The city saw an addition of around 450 new apartments in the quarter. Resultantly, the average weighted property rates hit stagnancy in Jan-Mar 2019.
Housing demand remained inclined towards the affordable segment, i.e. homes priced within Rs 40 lakh. The luxury segment continued vying for buyers and the demand-supply gap in the category widened marginally, putting a downward pressure on average ‘asks’. Unsold inventory, nonetheless, declined minimally and stood at 30,000 units at the end of the quarter. The average Quarters-to-Sell (QTS) the existing residential stock in Chennai now stand at 4.8, unlike 6.2 in 2017.
Chennai’s expanding metro network is seen as the sole ray of hope for both residential and commercial segments. Subsequent to the opening of the final 10 km stretch of the Phase I of the Chennai Metro, areas such as AG-DMS, Chennai Central, Mannady and Washermenpet witnessed more deal closures.
Chennai closed the Jan-Mar 2019 quarter with a five percent increase in sales volume over the previous quarter. As the city’s preference for ready-to-move apartments priced within Rs 40 lakh continued being unchallenged, chances of any upward price revision remained a far cry. The housing segment, thus, witnessed no change in property rates, QoQ, while rentals increased by an average of three percent, YoY.
The housing belts of Kilpauk, Manapakkam, and Poonamallee emerged as the forerunners on the capital charts with an average price appreciation of 4-5 percent, QoQ. Brimmed with a plethora of residential projects in different ticket-sizes, the localities successfully managed to draw the attention of prospective homebuyers. Additionally, the presence of adequate amenities and smooth connectivity to other parts of the city gave a thrust to the housing demand here.
Localities such as Egmore, Thoraipakkam, Selaiyur, and Iyyppanthangal followed suit with an uptick of three percent, each, in the capital rates, QoQ. While Egmore is popular among buyers owing to its excellent connectivity and proximity to commercial and residential hubs, Thoraipakkam garnered traction because of its proximity to prominent industrial zones and IT parks. Ample housing options and infrastructure developments have made Thoraipakkam a sought-after locality among end-users.
The rental market, however, recorded an uptick of three percent in the ’ask’ rates, YoY. Guindy, being an industrial estate, clocked a growth of nine percent in the rental values in the last one year. Proximity to prime areas such as Saidapet, Kotturpuram, and Adyar ensured better traction in the region.
South Chennai, the IT/ITeS hub, remained a favourite amongst the tenant community. Siruseri, Selaiyur, Tambaram, and Kelambakkam were some of the prominent locales in the South which recorded a surge of nine percent each in the average rentals, YoY. Popular localities such as Medavakkam, Madipakkam, and Pallikaranai, too, witnessed an appreciation of 4-8 percent, during the quarter ending March 2019.
Disclaimer: The views expressed above are for informational purposes only based on industry reports and related news stories. 99acres does not guarantee the accuracy, completeness, or reliability of the information and shall not be held responsible for any action taken based on the published information.