Delhi residential property market stabilises

PUNE (May 11): After a 10 to 20% decline in 2013, Jones Lang LaSalle (JLL) India Inc reported that residential property prices in several areas of Delhi began to stabilise last year.

“Overall, the Delhi National Capital Region (NCR) market is under stress, which means that valuations remain attractive for end-users. This also points to opportunities for distress sales and bargain buys for investors or buyers,” JLL India CEO for operations and international director Santhosh Kumar said in the “Delhi NCR: Should you buy a home in the next six months” report.

The report said several residential areas in India's capital city declined by 15% to 20% in 2013 and remained at the same level last year. These areas include Vasant Vihar, Defence Colony, Jor Bagh and Golf Links.

Gurgaon (pictured) and Noida maintained stable prices of between 2013 and 2014 – between Rs6,500 (RM370) to Rs17,000 psf, and Rs5,500 to Rs8,000 psf respectively.

“As developers remain under pressure due to excess inventory in Gurgaon and Noida, buyers and investors can expect significant discounts from developers here,” said Santhosh.

Despite the negative market dynamics in the mentioned areas in Delhi, upcoming NCR investment locations saw 15% to 35% increase in prices in 2013. These areas include Sohna, Neemrana and J and L zones of Delhi.

“…While Neemrana has massive industrial development along with good connectivity through the National Highway 8 (NH-8), Sohna promises the next wave of industrial and residential growth in Gurgaon. Delhi’s J-zone has the location advantage of South Delhi and the L-zone is in an area adjoining the upcoming Dwarka-Gurgaon Expressway,” said Santhosh.

He added that these upcoming locations that are lucrative for investors or those looking for farmhouses and do not currently have adequate social infrastructure.

“Thorough due diligence is a must for buyers making land purchases in these locations, particularly in Delhi’s J and L zones. The latter have highly speculative valuations,” said Santhosh.