Top Cities for Budget Real Estate in India

Here are 10 cities that offer great lower-budget real estate investment prospects over mid- to long-term.India’s cities draw the most housing demand for reasons like better job opportunities, living standards and infrastructure.However, rapid urbanization and development of these cities into mega-cities have given rise to challenges such as pollution, traffic issues, high property prices, etc.

The government’s initiative to provide ‘Housing for All by 2022’ is being pursued laboriously. The simple motive is to provide affordable homes within the price budget of up to Rs 25 lakh. This vision must necessarily encompass the smaller cities near the bustling cities of India.

Though afford-ability is a relative term, it is pertinent to look destinations where residential properties within the budget range of Rs 30-50 lakh are available, and are classified either emerging or growing sub-markets supported by good infrastructural development. These towns and cities offer a wide spectrum of investable options in real estate with relatively lower price levels, providing the incentives for future capital appreciation and healthy returns.

Hyderabad, Telangana 

After a prolonged slump due to the global recession followed by political turmoil, Hyderabad’s realty market is now once again set for an upswing. Hyderabad, with its buoyant and thriving economy and a dynamic workforce, is once again trending as a buyer’s market. The IT/ITeS industry has given further impetus to the real estate consumer trend, which is evident from the growing demand for residential, commercial and retail spaces. 

Pune, Maharashtra
The perfect blend of Pune’s manufacturing and services sectors makes the city a standalone economic powerhouse in all respects, with a rate of job generation that is hard to match. The city has witnessed steady appreciation over the last few years, and is ranked as one of the best markets for real estate investment. The luxury homes segment has been burgeoning on the Pune’s real estate market, with many large players entering with excellent luxurious projects. However, Pune is now witnessing a slight shift in the development trend. Many new players on Pune’s burgeoning real estate market can be seen venturing into the affordable housing segment. This is obviously the segment where the greatest demand lies.

Navi Mumbai, Maharashtra
Over the last few years, the real estate market in Navi Mumbai and surrounding areas have shown impressive growth, largely because of the planned approach taken towards development. Now, with Navi Mumbai receiving final nod for the International Airport, its property market and that of the surrounding areas have been showing great potential. While property prices have increasingly become unaffordable in Mumbai, Navi Mumbai still provides numerous options for residential housing within the budget of Rs 30-50 lakh.

Jaipur, Rajasthan
Emerging out of its image of being a majorly tourism-led economy; Jaipur has grown beyond everyone’s expectation to become one of the top global outsourcing cities in India. The upcoming IT Parks promise a great future across all real estate asset classes. The 250-kilometer stretch between Delhi and Jaipur has become a hotbed for real estate development, with areas like Manesar, Dharuhera, Bhiwadi, Neemrana, Kotputli and Alwar becoming the new catchwords for investors.

Surat, Gujarat
Surat, known as the diamond capital of the world, is a well-developed metropolis in Gujarat. Rated as one of the fastest growing cities of the world and also recently conferred with ‘Best Urban City of India’ award, Surat has also gained prominence and recognition for being the Cleanest City in India by INTACH. Rapidly improving infrastructure initiatives have helped modernise Surat significantly.

Ghaziabad, NCR
Ghaziabad is an emerging residential neighbourhood of NCR which has a very high supply of residential properties in the budget of Rs 30-50 lakh. Well connected via Metro and roads to the job markets of Delhi-NCR, the city caters largely to the mid-segment home buyers. The city has a high supply of ready-to-move-in properties offered by renowned developers. Some of the well-established residential clusters in Ghaziabad that have gain prominence in the recent time include Indirapuram, Kaushambi and Vaishali. 

Nagpur, Maharashtra
Although a city with extreme climatic conditions, Nagpur is one of the fastest-growing cities in India. Nagpur’s main claims to fame include its MIHAN and SEZ projects. However, with the Devendra Fadnavis-led BJP government taking keen interest in turning Nagpur into the next IT hub of Maharashtra, the city is set for a major transition in its real estate profile. The already-established MIDC corridor along with the upcoming IT parks have made Nagpur one of the cities that bear close watching by real estate investors.

Kochi, Kerala
Kochi is a metropolis in the making where modern urban lifestyles are settling into antiquated old traditions. During the days of its realty boom, Kochi grew exponentially, with more people migrating to the city and consuming even the outlying catchments of Palarivattom, Vytilla, Kakkanad, Edappally and Kadavanthra. Development of IT/ITeS projects such as the Kochi Smart City and initiatives to channelise traffic and improve connectivity, such as the Mobility Hub at Vytilla, have fuelled significantly increased demand for real estate, which more and more developers are cashing in on.

Coimbatore, Tamil Nadu
Coimbatore is the major industrial centre in Tamil Nadu after Chennai — and as incentives are given to IT companies by the Tamil Nadu government, Coimbatore has gained momentum as a preferred destination for IT/ITeS. With the government in power promoting the city by enhancing infrastructure development, Coimbatore’s property market has witnessed an upward push in demand for residential units in the core areas of the city such as R S Puram, Avinashi Road and Race Course, which are considered posh areas. Nevertheless, it has no shortage of affordable housing options. Coimbatore is a market where 40 per cent of real estate investments come from investors living in cities such as Bengaluru, Cochin and Chennai. Apart from the demand from professionals engaged in IT/ITeS, Coimbatore is emerging as a retirement destination, and demand for 2 BHK homes is high from senior citizens. Demand for smaller apartments is primarily from young IT professionals, while villas and row houses see demand from NRIs, retirees and IT professionals with a preference for such properties.

Ahmedabad, Gujarat
Ahmedabad may be the last one in the list, but it is in no way the least. With the city being a prime example of organised and fast-paced development for the rest of the cities in India, Ahmedabad has come a long way. With huge investments pouring into the state, rapid infrastructural development in the form of bullet trains, GIFT Smart City, the entrepreneurial nature of the population and a supportive, stable government, everything is going right for Ahmedabad. The oil, gas and energy industries, petro-chemical industries and automobile manufacturing industries are some of the major factors driving perennial demand for real estate in the city.

Occupancy Certificate not mandatory for small builders in Hyderabad

Occupancy certificate will not be mandatory for buildings which come up on plots up to 100 square metres with height up to seven metres. The exemption is given to small builders as occupancy certificate (OC) is directly linked to electricity and water connections.

The amendments were incorporated in the new GO on Building Rules issued by the Municipal Administration and Urban Development (MA&UD) department on Saturday.

Also, civic bodies like Greater Hyderabad Municipal Corporation (GHMC), which releases building permissions, should communicate the approval or refusal of occupancy certificate within 15 days. If any officer fails to communicate, the civic body could initiate action against the officer. The GO said occupancy certificate might be issued to owners after collecting compounding fees, if there are any minor violations and deviations from the sanctioned plan.

For high-rise buildings, the OC should be released by the civic body after inspection and getting fire ‘No Objection Certificate’ from the AP State Disaster Response and Fire Services department. Until now, the town planning wing used to give OC without fire NOC. Two buildings where fire accidents were reported recently found to be having OC sans fire NOC.

The MA&UD department has also prepared a pro forma for commencement notice, completion notice and occupancy certificate by giving more clarity. The pro forma have been prepared so that a civic body could also receive them online.

Environmental impact assessment provisions have also been incorporated in the new buildings rules. As per the GO, buildings and construction projects that come up in 20,000 sq metres area and 1,50,000 sq metres of built up area and township areas development projects covering an area of 50 hectares and or building up areas of above 1,50,000 sq metres should get environmental impact assessment.

Director of Town and Country Planning (DTCP) B Purushottam Reddy said awareness programmes and meetings would be conducted across the state soon for licenced architects, town planning staff on changes in the buildings rules, especially on setbacks and road widths.

IT corridors ideal for property investment in Hyderabad

Property market in Hyderabad is concentrated along IT corridors like Hi-Tech City, Kondapur and Gachibowli. All categories of housing have been active in the city – multi-storey apartments, houses and villas. According to market sources, despite Telangana issue, demand has remained constant for both domestic and international property buyers. In some areas like Gachibowli and Hi-Tech City, demand for villas matches multi-storey apartments demand.

Infrastructure development like the International Airport, completion of the Outer Ring Road (ORR), about 30 radial roads, MMTS, metro, procurement of water from Krishna and Godavari rivers, etc are all attracting global MNCs and investors to start their operations in Hyderabad.

According to G Yoganand, CMD, Manjeera Group, “The city has witnessed second highest occupancy of IT spaces in India during last one year. Hence, this is the best time for property buyers because Hyderabad may witness property boom in the mid-term. IT Corridor is the best place for investment. The mode depends on the budget. A plot in a good location is always the best but you will not get loan.”

IT corridor areas like Gachibowli, Kondapur, Madhapur, Nallagandla, Nanakram Guda, Kokapet, APPA junction, Hi-Tech City are ideal for investment.

According to MagicBricks.com, Hi-Tech City has seen an increase of 17% in values of multi-storey apartments in the Jan-Mar quarter this year compared to Oct-Dec quarter in 2011.

When talking about where the maximum demand is coming from, Yoganand added that Hyderabad has investors from across the country. “Even now, many people from Andhra region are buying and they are not worried about Telengana. Whether Telangana or no Telengana, Hyderabad is the best place in India to invest for better appreciation. Hyderabad has the best infrastructure, cosmopolitan culture, no language barrier, less pollution, better weather conditions, and better connectivity by road, rail and airways to all important cities of India. Prices are also reasonable,” he added.

Infrastructure is a key reason for the increase in demand in Hyderabad as well as for the rise in property values. A major infrastructure development has been the commencement of the Phase I of Metro covering Nagole and Gachibowli, market sources say. Rakesh Sudam of Earthwide Properties pointed out that infrastructure like the Phase I of Metro will affect localities like Nagole, Uppal and Gachibowli. “Values are already rising here and are expected to rise by 5 to 10% in the next 3 to 6 months,” Sudam said.