Urban Poverty Alleviation, the current estimated shortage inclusive of existing and future demand is of 18.78 million urban houses. This total demand is expected to increase at a compounded annual growth rate (CAGR) of 2.8 per cent across India.
The HOT SPOTS
In one such study, the global real estate consultancy Cushman & Wakefield (C&W) India has reported that the new, future demand (not factoring in the existing demand) for residential dwellings in the period 2012 – 16 will be 11.8 million units across India.
The firm has identified the top eight cities, which will constitute 18 per cent or 2.1 million units of the total demand across categories. Of the total additional demand in these locations, the mid-priced segment is estimated to be highest at approximately 59 per cent or 1.3 million units, followed by demand in the high-end segment which is 4.51 lakh units.
“The demand creation in such cities is a reflective of the economic strength that these cities have, and that it attracts new settlers as well as creates conducive environment for natural population growth.” says Sanjay Dutt, executive managing director, C&W, India.
The low-end segment is expected to see fresh demand of approximately 3.62 lakh units in these cities in the next five years. The top on the list of eight regions is Ahmedabad followed by Bangalore, Chennai, Hyderabad, Kolkata, Mumbai, National Capital Region (NCR) and Pune.
This data indicates not just the possible demand-driven profit locations but also the segments to invest in and is calculated on the basis of past trends for population, household growth and income classification. This does not take into consideration the existing unfulfilled demand by those without homes, living in congested or dilapidated structures, living in rental houses, demand from NRIs or those wishing to purchase second or holiday homes for use or investment.
Jones Lang LaSalle India (JLLI), has adopted another framework and has put together a list of non-metros and emerging cities. In western India, Ahmedabad, Jaipur and Jodhpur are suggested while in the north, Chandigarh is favoured. In the south, it suggests Kochi and Coimbatore and Visakhapatnam in the east as one of the emerging and non-metro locations for significant appreciation in future. These locations require low capital investment as compared to the highly developed metros.
Their demand drivers are interesting. Ashutosh Limaye, head of research, JLLI, says that Ahmedabad, the commercial capital of Gujarat has one of the highest