When you compare the vibrant real estate markets of Mumbai, Delhi, Bangalore or Pune, the realty market in Kochi may seem a little slow. There is however great news for buyers and investors. Development in infrastructure and Kochi metro’s commencement along with the initiatives to make Kochi a smart city and beginning of numerous job avenues in Kochi are contributing steadily to Kerala real estate in this city.
What makes Kochi a good city for investment?
Metro Railway in Kochi
The stretch between Petta and Aluva is a 25km long one and links important stations such as Ambattukavu, Companypady, Edapally, Kalamassery, Ernakulam South, Palarivaton and Elamkulam among others. This is a potential corridor for real estate growth in Kochi, an important city for Kerala real estate.
Even though easy transport is the agendum, realty is relying upon areas which fall in this stretch. There has already been a rise in property prices. City realtors and builders are quite optimistic because they feel that Kochi is the commercial and business capital of Kerala. Actual transactions happen in the city even though Trivandrum may be boasting realty growth. Since infrastructural developments invite investors, they are always welcome.
A zealous endeavour has been taken up by Kerala’s government to establish Kochi as a smart city which will also be a business township which would be operation by the year 2015. The government aims to bring in a new revolution in Kerala’s job market. It aims to open up 90,000 new jobs by 2020. Such a scenario would be advantageous for someone investing and working here. More availability of jobs would spur housing demand and also create a market for rental Kerala real estate.
The growth in real estate is expected from non-locals who move to the city for work opportunities. The operational expenses and living costs are much lesser in the city compared to other metropolitan cities.
Investors should take the cue and bid their time for Kochi to become a significant IT destination in the coming future. In terms of literacy, the city does not lag behind although it is behind in terms of employment opportunity generation. When the job opportunities expand, realty market participants would be able to attract twice the numbers of investors that they do currently.
Boom in the Micro Markets
Suburban localities such as Palarivatton, Vytilla, Edapally, Kadavanthara, Panampilly Nagar and Palarivatton are buzzing with lots of projects in the affordable range. The stretch along Edapally Bypass is slowly getting transformed into a hub for retail stores and the vast supply of space for building malls can be seen frequently. Kochi has been classified as a cosmopolitan area. Most of the buyers are young and come from different backgrounds. For suiting their needs, the city is producing different outlets for investment, recreation and commercial opportunities.
The SEZ allotted for manufacturing units related to aircrafts and Aerotropolis and the Vytilla Mobility Hub development which would channelize city traffic would mobilize the rental and capital market of the city.
Outlook of Property Prices
Almost 31 percent of the purchasing population prefers to own property in multi-storeyed apartments. For a 2BHK unit, the price is between Rs 20 and Rs 80 lakhs. The size of these units varies between 650 sq. ft. and 1572 sq. ft. If you choose a 3BHK unit, the amount required starts from Rs 23 lakhs and goes up to Rs 4 crores. The size of such apartments is between 800 and 3500 sq. ft.
The rental market of Kochi in Kerala real estate is not highly established. Whatever demand is there is mainly for fully furnished flats. For instance, a flat measuring 1000 sq. ft. which is near the IT Park would command a rent of Rs 50,000 or so, which youngsters may take up on sharing basis. In areas such as Kakkanad and Kadavanthara, the rough rental property rate is Rs 8000 in a month whereas rental property along the Marine Drive is around Rs 45,000 in a month.
Therefore, if you are thinking of investing in Kochi, by all means go ahead. The development which is going on in the city reassured good returns for investors who have long term vision. For streamlining the Kerala real estate sector, the government is also thinking of introducing a variety of measures such as online services for plan approvals and a specific realty authority.
The state is working on the fine lines of the Real Estate Authority Bill which is along the Real Estate Authority Bill as introduced by the Indian Government. The proposed legislation’s draft shall be available in public domains in under a month, as stated in Recon 2014, the first Kerala real estate convention. The state’s government is looking much forward to bringing order in the realty market. The Real Estate Authority Bill draft shall be brought out within one month’s time. The bill shall be finalised post consultation with stakeholders of the sector. The government is open to different suggestions.
The online service for approval of plans for property developers and builders was an important step which has been planned by the state government for cutting out graft and unprofessionalism in this sector. The delay involved in obtaining clearances have made the authorities concerned about construction is quite high which also leads to an increase in the cost of project completion. The portal shall do away with illegal practices and make the process completely transparent. The form can be filled in by anyone in the proper format, submitted and clearance shall be given for the construction within 30 days. Because of severe land shortage in Kerala, the state cannot stick to the CRZ or Coastal Regulation Zone norms. The state government has approached the centre already, looking for exemptions. Because of the geographical pattern of the state, Kerala was facing a lot of pressure in terms of land availability.
Kerala real estate is coming up quite quickly because of the initiatives undertaken by the state government. Investors have much reason to rejoice as realty in the city would expand rapidly.