It is in the doldrums, no doubt about that. I dont see any big projects being launched and for the existing projects as well, promoters are trying all possible means to sell them. The heartening thing that there is still some interest left in real estate, when the recently concluded Fairpro exhibition had a roaring business for the builders as well as the lenders. In 3 days time, it is believed that 200 crores worth of business was done. Not a small figure, definitely.
But if you look at the rates, it has definitely come down over the last 1 year. My guess is it is down somewhere between 10 - 15% in the suburbs and satellite towns like Chingelput and Kancheepuram. I have few examples to quote.
1. The first one is the Prince Residenzia project in Sriperumbudur. Last year, they were quoting at Rs2500/- per sq.ft plus other charges. Today, the same project is quoting at Rs2175/- per sq.ft plus other charges. This I got to see from the newspaper advertisements over the last couple of weekends. The project is on the Bangalore National Highway just before the toll plaza and Venkateswaran Engg college. It is definitely a good location if you have interest in Chennai-Sriperumbudur - Kancheepuram belt.
2. The second one is the residential land in Kancheepuram. This is a DTCP approved layout from BLB Estates, one of the well known promoters. When we visited this layout last year, they were quoting at Rs375/- per sq.ft and they were willing to give it at Rs350/- or so. Today, the price they are quoting has come down Rs300/- per sq.ft with another 2-5% price reduction possible. I have written about this layout here.
3. The third one is again a residential land at Vandalur from BLB Estates. Today's price is Rs685/- per sq.ft compared to Rs750/- sq.ft one year ago. Again there is a scope for further reduction in the price through negotiations. This layout I was told is away from the GST Road by a good 3-5 kms. I need to visit it once.
4. The fourth one I have enquired is about the residential land in Athur Village on the Chingelput - Kancheepuram state highway. This layout is promoted by MS Estates and they are in this field for more than 15 years. The price they are quoting today is Rs295/- per sq.ft compared to Rs350/- sq.ft last year. This layout is 3.5 kms from the GST Road and 500 metres from the Chingelput-Kancheepuram state highway. I have seen layouts around this area and I can say this is an interesting piece of property. Actually, if you look at closely, this is hardly 3.5 - 4 kms from the Chingelput town centre. Chingelput is a big town and district headquarters with good infrastructure facilities. It has a direct train link to Chennai on an hourly basis and number of buses ply between Chingelput and Tambaram. On top of it, the village Athur has existing pucca built houses and existing infrastructure.
Overall, the prices are coming down but not sure if it is the right price or will it go further down. Considering the macro economic fundamentals, I dont see any big fillip for the real estate sector in the next 6 months to 1 year time frame, so we may still get better prices. In case if somebody is planning to buy a piece of real estate, then there should be hard bargaining with the promoter. Dont buy without quoting a price which is atleast 25% less than the quoted price.