How are Property Rates in Pune Forecasted for 2020?
Pune, the cosmopolitan with its own distinctive civic flavour, is on the cusp of experiencing a major facelift. The key catalysts for the same are proposed execution of Pune Development Plan merging 23 villages, materialization of the visionary Pune Smart City project, and flagging off of Pune Metro by 2021.
Accordingly, the real estate market is abuzz with speculations regarding the trajectory on which property prices would move. Experts opine that property rates in Pune would move significantly up by 2020. This is keeping in perspective the present healthy Q-on-Q (quarter on quarter) appreciation being registered by major locations as well as projected improvement in civic amenities in future.
Triggers for Price Upswing by 2020
A report in Economic Times (by Sobia Khan, ET Bureau, Dec 09, 2016) had strategically captured the sentiments of real estate market across major Indian cities. The demand for residential properties is projected to outstrip supply.
Source: Report by Cushman & Wakefield and GRI
Existing real estate inventory would gradually be sold off as Pune is headed for massive urbanization. The ambitious plans ready to be rolled out would attract a large crowd of professionals from other venues within Pune.
This is expected to happen by 2020 with most of the aggressive modernization plans would have been successfully executed or would be on the verge of completion. Property rates in Pune 2018 would manifest an increasing trend which would continue to consolidate itself by 2020.
Major Trends Influencing Property Prices in Pune
The ambitious ‘Housing for All’ scheme is slated to reach its culmination by 2022. IN the intervening years, major work is expected in the area of affordable housing, particularly for low and medium income group people. This implies that HIG (High-income group) flats would attract a premium to offset the subsidies offered to low-income class. The decision would drive government property rates in Pune up causing an upward revision in coming years.
Most builders in an attempt to woo the LIG (Low Income Group below 15 Lakhs annual income) would start offering dedicated services for this segment. This would take its toll on the properties developed for MIG (income range 15-70 lakhs) and HIG (>70 lakhs income per annum).
By 2020, properties intended for these 2 classes would witness a downsizing which would skew the demand and supply graph. Limited inventories in major locations would fetch more prices per square feet.
Will property rates in Pune come down by 2020?
Well, reputed builders like Sancheti would definitely try to check any unwarranted escalation in prices. However, one must be wary of unscrupulous developers who might allure gullible prospects in their folds with low price offers (that may later turn into an unprofitable deal for customers due to cryptic clauses).
The unsold inventory of present HIG and MIG flats would experience higher demand. Presently, such properties have failed to live up to the expectations of buyers due to higher price and less value proposition.
RERA (Real Estate Regulation Act) can also prove to be a price lever. Builders have to adhere to a strict code of professional conduct and also have to indemnify buyers for any material defect in construction or project delays. In order to compensate for the high price of raw materials and potential interest on delayed projects, builders in all likelihood would attach a premium to the price especially for major locations.
For example, property rates in Kharadi Pune for MIG and HIG would definitely experience steep price hike if all attributing factors are to be considered. Sancheti and other customer conscious builders would be the mainstay for buyers due to genuine rates offered for top-notch constructions. It is an opportune time now to invest in properties to remain immune from hikes that would sweep Pune’s real estate market by 2020.