Chennai Properties Fallen Prey to Rising Inflation

No city in India has left untouched with the inflationary rates. And the real estate too has been struck hard by this boom in prices. Talk of Chennai real estate and they do are stomaching the pain. The residential properties are in exodus here, while the demand does not match up to them. What's the result? Lacs of houses are lying vacant right now. As the economy is bearing the brunt of the falling rupee, people are wavering in their decision to buy a property in the city. Until the inflation changes its demeanor and the prices fall back, at least to their previous values, there is little hope that the demand for properties in the city shall see any swelling.

As per a report from National Housing Bank, an overall decline of 2.3% in the rates of flats for sale in Chennai was recorded in Apr-Jun quarter of 2013. The sharpest decline has been witnessed in peripheral areas of the city: a slow-down by 30-40% clearly shows that inflation and oversupply have played a negative role in falling of rates. The overall sales have plummeted. Such a scenario has left enough scope for negotiation; buyers can they can make a purchase at cut-prices. As the market is hard for developers, they are coming with freebies and other discount offers.

 

Anna Nagar West, a region where demand mainly comes from the elite segment, has seen a decline of about 13% in price rate. At Kilpauk, where per sq. ft rate of a property is a whopping Rs. 11600/-, a depreciation of 3% has brought down the rates a bit. On the same lines, Medavakkam, Kovilambakkam, GST Road, and Thiruvanmiyur are some of the localities where Chennai properties have come down from their original values.

The above trends are not uniform. In spite of the fall in prices, there are still regions where apartments in Chennai have seen an appreciation. Take, for instance, Thoraipakkam: the property rates in this locality, have escalated by 7%. Same is the case with Kelambakkam, Navalur, Pallikaranai, Madipakkam, and Korattur: the real estate rates have increased between 5% and 9%. At other localities like Padur, Selaiyur, Velachery, Ambattur, Chromepet, Mogappair, and OMR too, the trends are on higher side.