A property expert is nothing but an observer. He observes some areas / localities are expensive, some other maintain a steady rate, and some grow expensive over a short period of time. He knows when to strike a transaction and yield profit. When do property rates appreciate? When do they decline? A property seeker might be puzzled. The value of a property normally appreciates depending up on various factors. Here are 5 facts that mainly influence property valuations in India:
1. Infrastructure development in the surrounding area is the single most important factor thatinfluences the property valuations. This development can be in the form of Roads, Airport, Bus Terminals, Malls etc. Infrastructure development in the form of easy transportation through Metro Train also plays an important role. The evidence of this could be seen in property valuations in and around Delhi & Bangalore Metro.
2. Commercial real estate development in the like Offices and SEZs also play a key role. With busy office lives, people prefer staying close to their workplace to save on time. This is again visible in areas like Gurgaon, Noida, South Bangalore, Mumbai Andheri-Borivili, Navi Mumbai, Pune & Hyderabad.
3. Quantum of disposable income in the hands of public is a key factor. It has been observed that neighborhood that come around IT hubs have superior valuation compared to manufacturing or agricultural hubs. This can be directly related to the disposable income.
4. Availability of land drives property valuation. Areas where large amount of land is available for residential purposes tend to appreciate slowly compared to areas where land in a scarce resource. Central Delhi and South Mumbai are perfect example of this phenomenon.
5. Connectivity is another key factor. Areas that are well connected with the business and entertainment hubs of the city enjoy higher valuation compared to areas that are not. Compare Gurgaon with Kundli, both are equidistant from the center of Delhi but there is a huge gap in their valuation.
There are other macro factors like Home Loan interest rate and Inflation that have a bearing on the property market sentiments and therefore on its valuation.
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