Noida emerging as top realty destination in NCR, should you invest?

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New Delhi | Updated: March 14, 2016 2:11:16 PM

It is not just the home-buyers who are increasingly getting attracted towards Noida and Greater Noida. Big business houses, start-ups and even PSU's are building permanent base in Noida, adding value to the region.

It was the difference in infrastructure, connectivity of metro, better electricity and water supply and above all schools which sealed the decision made by Mittals which meant staying a slightly smaller but better maintained accommodation. (Photo: PTI)It was the difference in infrastructure, connectivity of metro, better electricity and water supply and above all schools which sealed the decision made by Mittals which meant staying a slightly smaller but better maintained accommodation. (Photo: PTI)

An engineer, employed in a multinational, Rajesh Mittal and his wife finally decided to move from the bustling Indirapuram locality in Ghaziabad to Noida in 2015.

When Rajesh bought a 2,000 square foot flat in Indirapuram way back in 2005, he had no plans to shift back to Nodia where he was then staying on rent. But choices at that time were tough. Property prices were on the upswing and he decided to buy a bigger flat in Indirapuram which was about 20 per cent cheaper than Noida.

Having two young daughters in a family of four, Rajesh and his wife always felt that something was missing in Indirapuram.

And that’s when they decided to buy a flat in Noida and make the move back from Indirapuram which by now had become much crowded, congested and polluted in comparison to the greener confines of Noida.

Rajesh Mittal and his wife Rachita Mittal. (Courtesy: Facebook)Rajesh Mittal and his wife Rachita Mittal. (Courtesy: Facebook)

It was the difference in infrastructure, connectivity of metro, better electricity and water supply and above all schools which sealed the decision made by Mittals which meant staying a slightly smaller but better maintained accommodation.

This is exactly what makes Noida a faster-growing real estate destination in comparison with peers like Indirapuram, Vaishali or Faridabad.

“Noida is a good investment option for those willing to hold properties long-term. It is advisable for investors to opt for projects by reputed builders, in areas where the civic and social infrastructure is either strong or is developing at a good pace,” Narasimha Jayakumar, chief business officer, 99acres.com said.

Godrej Properties in January marked its entry into Noida by collaborating with NCR-based builder Lotus Greens to build a housing project on 36 acre land parcel in sector 150. There were reports that Tata Housing is also in talks with Lotus Group to make its foray into Noida. This indicates a healthy surge in interest of leading developers who see Noida as a leading real estate market.

“We have seen strong growth in the scale of our operations in NCR and look forward to building on this momentum through our entry into Noida, which is one of the country’s leading real estate markets,” Pirojsha Godrej, managing director and CEO of Godrej Properties had said while announcing company’s foray into Noida. He had further added that the company wants to replicate Gurgaon’s success in Noida.

Noida’s connectivity to Delhi and Gurgaon, metro service and good infra facilities makes the living experience better in this NCR region. Realty experts see its affordable housing tag as one of key reasons why focus has shifted to Noida among NCR regions. With the prices rising CommonFloor’s recent survey titled “NCR Consumer Confidence Index – H1 2016” revealed that around 30 per cent respondents preferred to invest in micro markets in Noida in contrast to other areas in the NCR.

Skyrocketing prices have made Gurgaon residential market unaffordable for many, As a result, the focus has shifted to other areas in NCR, particularly Noida. Well developed social and physical infrastructure in the region and good connectivity via Expressway has boosted the demand. “Noida realty market also offers good returns on investment with an average yearly expected appreciation of 10-15 per cent, which is an appealing factor for several investors interested in the region”, says Vikas Malpani, co-founder and head of CommonFloor Groups.

And it is not just the home-buyers who are increasingly getting attracted towards Noida and Greater Noida. Big business houses, start-ups and even PSU’s are building permanent base in Noida, adding value to the region.

As Shveta Jain, managng director, Cushman and Wakefield sums it up,”The office market in Noida is also gaining traction due to availability of quality office space at lower rentals compared to Delhi and Gurgaon and presence of excellent infrastructure. In 2015, Noida witnessed net absorption of around 1.2 million square feet of office space. The incremental take up of office space is expected to boost demand for residential space in the sub-markets of Noida”.

According to market experts, the surge in interest is not sudden, but has been a gradual progression from Noida being just a peripheral location to a bustling realty hub in the National Capital Region. While companies are expanding their operations in Noida due to large floor plates and cheaper rentals as compared to Gurgaon. Developers are looking at making the most of this trend by offering budget inventory for which the demand is expected to surge in future.

Affordability and ample deal options available are the key factors that work for Noida. However, with burgeoning inventory, experts have a word of caution. Investors should do a thorough check of the developer before investing in Noida. Many investors, however, are also wary of the innumerable number of inventories piling up in Noida and do express concerns over less demand and abundant supply over the coming years.

Though Santhosh Kumar, CEO, operations and international director, JLL India feels staying invested in Noida does make sense. “Many corporates (MNC & National) are setting up their base in Noida, which is adding to the employment generation in that region. Also, the availability of labour on the outskirts of Noida is attracting many manufacturing-based companies to set up their operations in this region. This is leading to the movement of people from the peripheral regions to the main Noida region. Noida, being a good affordable market, can cater to these demands; therefore, investing here can yield reasonable returns in the future”, he says.

To ensure that valuations of the property rises, investors must look for proximity from the metro station, absorption rates, credible developers with a good track for completing projects.

Where to invest in
Being a good affordable market with good infrastructure, it is a suitable destination for realty investment. However, most of the realty experts advocate sector 78 in Noida as it has witnessed maximum price appreciation in the near-term. According to Commonfloor’s yearly report titled ‘NCR Real Estate in 2015’, sector 78 in Noida was one of the top localities that saw maximum price appreciation in Delhi-NCR during the year. Sectors 49, 110, Expressway, 79, 74, 117 and 63 are some of the other attractive investment destinations of Noida.

Price trends
All the three micro-markets – Noida, Gurgaon and Ghaziabad are suffering due to gap between demand and supply. While both Noida and Gurgaon suffered a capital fall of 2 per cent in average capital rates in the last quarter of 2015, property prices in Ghaziabad have remained stagnant. According to 99acres.com, things, however, look more hopeful now for Noida with new infra plans like the upcoming metro in the pipeline. Market reports suggest that Noida has the maximum unsold inventory in NCR and as of now, over 1.2 lakh flats here remain unsold.

Rajesh Mittal and his wife Rachita Mittal. (Courtesy: Facebook)

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