Lucknow, last week, found a place in the growing list of Prime Minister Narendra Modi’s 100 smart cities mission. Experts see this city of erstwhile Nawabs as one of the fastest growing cities in the country as well as amongst the peer group of Tier II cities is now a well established fact.
The move is expected to help the city see improvements in lifestyle and amenities boosting the prospect for both the realty investor and the end user.
“It is likely to lead to higher level ‘Urbanization’ not only in Lucknow but in the close vicinity as well. Health and hygiene is likely to improve in the future and it is expected to generate lots of business development opportunities, particularly in the service sector, leading to higher employment. Needless to say, all these developments will be further strengthening the city’s real estate potential,” Mohit Goel, CEO, Omaxe Ltd said. Omaxe has major real estate operations in Lucknow.
According to recent Reserve Bank of India report, Lucknow witnessed the highest increase in housing prices in the country rose during the October-December quarter of the 2015-16. On an annual basis, in Q3:2015-16, Lucknow witnessed the highest increase of 16.1 per cent.
Besides, Lucknow is a very well connected city and has very good road, rail and air connectivity. It is witnessing significant infrastructure growth, including Lucknow Metro, IT City being developed by HCL Technologies, Indian Institute of Information and Technology (Lucknow) and the 1,000-bed Medanta – Awadh super-specialty hospital. All of these combined together have made the city the toast of real estate investors.
According to Goel, Lucknow is one of the fastest growing real estate market, which offers wide option to consumers from affordable housing to luxury projects, world class amenities and good infrastructure.
Experts said that despite being lower in valuation, Lucknow can still be a good realty bet in the long-run if it continues to focus on infrastructure and and job creation as that would mean migration to the city itself and in the peripheral areas as well.
Like other cities, Lucknow also has its share of unsold inventories, but it is still in a relatively better position compared to other cities.
“The unsold inventory overhang in Lucknow is more in the premium flats. The middle income flats and plotted developments are still having a good take up, driven primarily by end user demand from city residents and also people migrating from nearby cities, on account of better infrastructure and quality of life,” Saurabh Mehrotra, national director – advisory services, Knight Frank, said.
Here is where experts caution people investing in Lucknow real estate. Home buyers should invest in properties with a credible and reputed name with a decent track record.
“A large part of Lucknow real estate market is still in the unorganized space. Investor should be extremely cautious of the approval status of the project, reputation and past track record of the developer,” Mehrotra added.
Where to invest in Lucknow
With the robust development taking place and the smart city tag, Lucknow real estate is bound to grow. Among the areas which are promising to invest in are Shahid Path and Kanpur Road, according to Knight Frank. “These areas should witness organised development and good price appreciation primarily driven by better connectivity and infrastructure improvement. The stretch connects to four state highways (Faizabad Road, Kanpur Road, Rai Bareilly Road and Sultanpur Road), has good connectivity to airport & different parts of Lucknow city, and is also witnessing grade A developments,” it said.
Omaxe lists Gomtinagar Extension, Indiranagar Extension and Jankipuram Extension as important real estate destinations as a lot of real estate activities are taking place around national highways and state highways that connect cities such as Kanpur, Rae Bareli, Sitapur, Faizabad, Sultanpur and Hardoi among others.