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Noida replaces Mumbai in real estate ranking

Last updated on: August 9, 2012 11:48 IST

Noida replaces Mumbai in real estate ranking

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Dilasha Seth in New Delhi

Noida has replaced Mumbai as the second-best realty destination this year, according to an analyst report. Gurgaon-Manesar retain the top slot.

The rankings by real estate data firm Qubrex are based on eight parameters - supply and demand, likely price appreciation in three years, emerging connectivity, potential growth in economic activity, nationally reputed builders, infrastructure, land acquisition risk, etc.

Noida rose from the sixth slot last year, owing to increasing connectivity, the likelihood of the Delhi Metro being extended to Noida Extension in two to three years and the expected master plan clearance by the National Capital Region Planning Board.

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Image: A farmer works in a wheat field against the backdrop of residential apartments undergoing construction in Noida.
Photographs: Parivartan Sharma/Reuters

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"The land acquisition risk has come down, as the NCR Planning Board would clear the master plan soon," said Sanjay Sharma, managing director, Qubrex.

He, however, added hurdles in Noida Extension and the Yamuna Expressway remained. Major roads are expected to be operational soon, said Sharma.

The Yamuna Expressway, which would connect Delhi to Agra, is scheduled to be open on Thursday. According to a Cushman and Wakefield report, in the quarter ended June, Noida saw the highest number of new units launched in the NCR.

Experts say the Mumbai real estate market has also heated up, and with the economy slowing, investors are putting their money in the mid-income category, rather than high-end properties.

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Image: A vehicle drives past residential buildings in Mumbai.
Photographs: Punit Paranjpe/Reuters

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According to the Qubrex rankings, Mumbai slipped to the third position in July from the second in December 2011.

"There are large unsold inventories in the city," said Sharma. He added since the Panvel airport project seemed to be running into land acquisition problems, the parameter of 'potential growth in economic activities' was rated a notch lower.

"Mumbai is an investors' market, but investors in times of slowing economic conditions are going for other options to invest, instead of heated-up markets," said Anshuman Magazine, head, CB Richard Ellis.

Developers in Mumbai and Delhi saw pre-sales fall up to 30 per cent year-on-year, stated a report by brokerage firm Kim Eng.

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Image: A water tanker moves past Malibu Towne residential apartments in Gurgaon.
Photographs: Parivartan Sharma/Reuters

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"Customers are waiting for developers to reduce property prices. These have risen 30 per cent over the last one year," it stated.

Mumbai saw a fall of 73 per cent in supply in the quarter ended June, compared to the quarter ended March. Only 1,200 units were launched in Mumbai, against 4,460 in the previous quarter, while nine projects were launched in the quarter, according to data by Cushman and Wakefield.

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Image: A view of Bandra-Worli sea link bridge, also called the Rajiv Gandhi Sethu, in Mumbai.
Photographs: John Goh/Reuters

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Gurgaon remained at the top of the rankings, despite drawbacks like the violence at Maruti's Manesar plant. However, it secured only 8.5 points, compared with 9.2 points in 2011, owing to water electricity shortage in the region.

"Potential growth in the region also saw a cut in ratings due to the Maruti unrest and other labour problems," said Sharma. However, he added new licences may be curbed, and this would help maintain an attractive supply-demand equation.


Image: People ride their bicycles under overhead power cables, against the backdrop of multi-storey residential apartments in Gurgaon.
Photographs: Ahmad Masood/Reuters

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