Press Release

Property Prices in Chennai grew by 6% in Oct-Dec 2014: 99acres.com Insite Report

February 16 2015

Major Highlights:

  • Kodambakkam was the highest gainer in Chennai, recording a surge of 18 per cent in property values in Oct-Dec 2014
  • The rise in property values can be attributed to the Chennai metro rail, construction of roads, renovation of bridges and development of flyovers
  • Rental values in Chennai rose by an average of 17 per cent due to the presence of IT majors
  • Across all cities, Chennai witnessed the second highest supply of independent houses/villas, preceded only by Hyderabad

Chennai, 16 February, 2015: 99acres.com Insite is a quarterly report focusing on capital and rental price trends in the residential real estate market across seven major cities of India. According to the report, property prices per sq ft in Chennai have witnessed a growth of six per cent in Oct-Dec 2014 as compared to the preceding quarter, and 12 per cent annually. Rental values have also increased by 17 per cent between Oct-Dec 2014 and Jul-Sep 2014. The most preferred unit type in the city continues to be 2BHK. The supply of residential properties in Chennai has recorded an appreciation of 14 per cent in the quarter ending December.
Commenting on the report, Mr Narasimha Jayakumar, Chief Business Officer, 99acres.com,said, &ldquoChennai&rsquos real estate soared in anticipation of better connectivity via renovation of roads and bridges, development of flyovers and construction of the metro rail. The six per cent growth is also attributed to presence of IT majors which propelled rental demand.&rdquo

Price Analysis of Chennai (Oct-Dec 2014 vs.Jul-Sep 2014)
Residential Apartments:

  • Recording a spike of 18 per cent, Kodambakkamhas become the highest gainer in Oct-Dec 2014 as compared to Jul-Sep 2014. The commutation lifeline of the area,the Kodambakkam Bridge, was refurbishedand opened for two-way traffic, which is the prime reason for the rise in capital values.
  • K.K. Nagar and Ashok Nagar saw a substantial increase of 16 per centeach in Oct-Dec 2014. Annually, the capital value of properties in these two micro markets jumped a whopping 65 per cent and 59 per cent, respectively. The construction of the metro rail has given a massive fillip to property prices in Ashok Nagar. The uptrend can also be attributed to therise in material and labour cost in these areas.
  • Velachery and Adyar have been receiving footfalls from High Net Worth Individuals (HNIs). This factor is supported by the kind of infrastructure improvements that these two localities are witnessing in the form of construction of the Mass Rapid Transport System and redevelopment of old properties.

 

  • The presence of numerous IT companies and IT Special Economic Zones (SEZs) drovePorur&rsquos realty to surge by 14 per cent in Oct-Dec 2014. Similarly, Ambattur&rsquos real estate climbed by 13 per cent due to better connectivity with neighbouring localities.
  • Localities of South Chennai including Padur, Perumbakkam and Siruseri, which form a part of the Old Mahabalipuram Road (OMR) belt, have stagnated due to rise in unsold inventory.
  • Thiruverkadu, Arumbakkam and Guindy have witnessed an upsurge of 11 per cent, 15per cent and seven per cent, respectively, in Oct-Dec 2014.

Rental Analysis:

  • Rental values in Chennai have grown by an average of 17 per centbetween Oct-Dec 2013 and Oct-Dec 2014. The rental market in all parts of the city increased in a year, with West Chennai taking the lead with 50 per cent, followed by North (19per cent), Central (18per cent) and South (15per cent).
  • Rentals in the top performing localities were driven by the presence of IT majors (in Porur) and proximity to developing suburbs of Ponmar, Ottiyambakkam and Sithalapakkam. Annual analysis also revealed stagnancy in RA Puram, Velachery and Nungambakkam.

Supply Analysis

  • Availability of Different Types of Property - Residential Apartments grabbed the limelight by occupying three-fourth of the total supply of properties in Chennai in Oct-Dec 2014. Followed by independent houses, which made up 22per cent of the market during the same span. Across all major cities, Chennai witnessed the second highest supply of independent houses/villas, preceded only by Hyderabad.
  • Availability of Property in Different Budgets  - Mid-income home buyers have maximum choice since properties within the range of Rs 25-40 lakh made up more than a quarter of the market. Capturing 26 per cent of the market, the high income housing segment (Rs 40-60 lakh) trailed closely behind with a quarter share of the market in Oct-Dec 2014.
  • Ready to Move vs. Under-construction - A quarter-on-quarter analysis revealed that the market share of ready to move in mid-income houses dipped the most &ndash by fiveper cent.

Supply of ready to move in properties in the ultra-luxury bracket grew by threeper cent &ndash from 16 per centin the third quarter to 19 per cent in Oct-Dec 2014. At the same time frame, despite having comparatively less properties in the ready to move in category, the affordable price bracket (within Rs 25 lakh) saw a six per cent rise in the availability of properties in that category in the last six months.

  • BHK-wise Distribution of Property - Though 2BHK units have always been the most suppliedconfiguration in Chennai claiming more than half the share of the total market, their availability declined by four per cent in the quarter ending December 2014. The second largest market share in the current quarter was taken up by 3BHK units which witnessed an uptrend of four per cent when compared quarter-on-quarter.

 

About 99acres.com:

Launched by Info Edge in September 2005, 99acres.com is a gateway to the one of the fastest growing property markets of the world, an information 'exchange' for buying, renting and selling of all types of residential and commercial properties anywhere in India. The website enables easy access to a huge property bank and allows direct connect with brokers/builders in cities as well as remote parts of the country. With over 6 million visitors visiting the website every month looking for real estate solutions, 99acres.com regularly enjoys the highest traffic share, time spent on site and maximum page views, making it the most popular real estate portal in the country. Backed by a strong team and a network across 17 cities in India, 99acres.com has garnered faith and support of the real estate community in India within a very short time span.

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