Property Rates Stabilise in Gurgaon

By: George Gonigal

Gurgaon's real estate market has stabilised for the past three months. Market experts had been predicting this halt for a long time and value analysis for this quarter proves just the same. The capital value for an apartment in DLF Phase I ranges between Rs 4,700-4,900 per sq ft. This is similar to the rates prevailing in December 2007 at Rs 4,200-4,700 per sq ft. This trend is being repeated in the rental values also. The rental values for 3 BHK in DLF Phase I have stabalised at Rs 22,000-25,000 per month, since December 2007.

This is just a random sample from the Gurgaon market. Localities as Sushant Lok and South City are showing a similar trend. The present capital value for a builder flat in Sushant Lok is Rs 6,986-9,315 per sq ft, which is somewhat similar to the prices prevalent in December 2007.

Vinay Govil, a property broker from Gurgaon, confirms that real estate market has stabilised at this time. He says that real estate market is directly linked to the share market. 'These days share market is witnessing a slump and hence the property segment is also facing a lull but this is a transitory phase. In next 6-8 weeks, I see the share markets and the real estate segment picking up significantly,' says Govil. He affirms that while individual transactions are still happening as usual, it is the investor buying that has halted. He feels that this slow down in the investor buying has impacted the property transactions.

Another property broker source, Ravinder K Sharma from Shubham Properties, agrees with Govil. He says that the property market has stabilised in the last quarter. However he feels that this is because of over-supply of the property. He says that many projects, that were earlier in the pipeline, have been completed in the last six months. Hence there is more supply, while the demand is more or less the same. Hence, the property prices have stabilised.

Sharma deals in properties in Gurgaon localities like Huda Sector 9, 9A, 10 and DLF. He says that the user sentiment has undergone a sea-change. Earlier, many users preferred the HUDA built flats. Now, most users enquire about the private developers. Also, a middle-income buyer is now inquiring about the premium apartments in Gurgaon. People now don't mind taking a home loan to purchase a premium flat.

It seems that the buyer's positive sentiment will push more transactions. Brokers don't mind it and nor do the home seekers have a problem with it.

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