In recent years, suburbs and peripheral areas of cities have emerged as the new hubs of realty projects. This has largely been due to the availability of land at affordable prices. Developers have acquired large parcels of land and developed modern townships and residential projects. However, are suburbs a better bet than city centre? analyses the reasons behind this transition to suburbs from the city centre.

If you are hunting for a new home in a limited budget, you are most likely to find it in a suburb or a peripheral area. That’s because such areas are home to a majority of the new and upcoming real estate projects. In fact, with the kind of infrastructure and realty development in recent times, peripheral areas have outshined many of the popular city-centric areas.

Owing to large scale development in peripheral areas, the boundaries of metro cities are expanding, say experts. While this kind of expansion has been seen in almost all metros in the country, Bangalore and Pune are classic examples. The dominant presence of IT companies in the suburbs of these two metros indicates their growing popularity over areas in the city centre. Here are key factors that have fuelled growth in these areas:

  • Land: Availability of land has been the prime catalyst for growth in peripheral areas. Eying large parcels of land, realty developers began to shift focus from the city to its outskirts. Affordable prices enabled them to buy huge tracts of land, which were ideally suited for large scale residential development.
  • Job opportunities: Suburbs have become the centres of economic growth. According to a World Bank report, published in 2013, suburban areas are witnessing faster economic growth and generating higher employment than the core cities.

    Metro cities including Mumbai, Delhi, Bangalore, Kolkata, Chennai, Hyderabad, and Ahmedabad witnessed a 16 per cent loss in manufacturing jobs from 1998 to 2005, the report states. On the other hand, rural areas, situated 10-50 km from cities, saw a 54 per cent increase in manufacturing jobs during this period.

  • Infrastructure: In recent years, there has been a tremendous improvement of infrastructure in suburban areas such as roads, sanitation and power supply. This has put to rest some of the earlier concerns of people, who planned to move to suburban areas. Owing to development of infrastructure, Whitefield, for example, has become a preferred residential area in east Bangalore. With leading schools, hospitals, hotels and shopping malls in addition to a number of technology parks, Whitefield has seen phenomenal growth of infrastructure and realty.
  • Connectivity: As connectivity of the suburbs has improved considerably, distance from the city is no longer a disadvantage for home buyers. In Bangalore, for example, Namma Metro has been instrumental in improving connectivity. The metro’s Purple Line, when fully operational, will connect Baiyappanahalli in the east to Mysore Road in the west.
  • Affordable prices: Affordability has been the biggest USP of realty projects situated in the suburbs. As compared to areas close to the city, realty projects in the suburbs benefit from relatively lower prices, which make them attractive for end-users.
  • Population density: The high density of population in the city has triggered the movement of people to the suburbs. While the population of metro cities in India saw an addition of 90 million people between 2001 and 2011, another 250 million people are expected to call these home by 2030, adds the World Bank report.

Due to the factors mentioned above, suburbs have seen a consistent demand of housing and office space. In order to get away from congestion in the city, end-users are showing an increased preference to live in suburbs and peripheral areas. This has meant that such areas have witnessed a healthy rate of capital growth. Besides, due to non-availability of land, areas in the city centre have reached a point of saturation. The increasing population has put pressure on the city’s housing market, which has resulted in expanding of its boundaries.