By Anuj Puri, Chairman – ANAROCK Property Consultants
Amidst rising demand for plots, some of India's top developers have ventured into plotted developments. With buyer preference heavily skewed towards established real estate brands, it is a dynamic opportunity for these players. In earlier years, plotted developments were largely offered by smaller developers.
The top cities like Bengaluru, Hyderabad, Chennai, Pune and Gurugram are seeing high demand for plots in the wake of the new realities presented by COVID-19. Some of the leading developers with plotted developments now include DLF Ltd., Mahindra Lifespaces, Raheja Group, Godrej Properties, Century Real Estate, Puravankara’s Provident Housing, Shriram Properties, Goel Ganga, TVS and Alpha Corp, among others.
The minimum size of marketable plots is as low as 550 sq. ft., and goes up to 10,000 sq. ft. In select projects, larger plots are also available. Plot sizes ranging between 1,200 - 2,500 sq. ft. are seeing maximum demand. However, in the southern cities of Bengaluru and Chennai, smaller plots of average sizes 550 - 750 sq. ft. are also generating interest.
Several plotted development projects have also been pre-launched in distant locales of MMR over the past few months. Interestingly, these projects have larger-sized plots than in the southern cities. The minimum plot size starts at 1,600 sq. ft. and goes up to 5,000 sq. ft. on an average.
The starting price for plotted developments in the top cities is as low as INR 14 lakh. Plots priced up to INR 70 lakh currently see the maximum demand, though larger plots are also seeing traction.
Prominent Micro Markets with New Plotted Developments
The peripheries of the top cities have most of the new plotted developments supply:
- Bengaluru - major micro-markets for plotted developments include Devanahalli, Jigani, Varthur, Dodaballapur Road, and Yelahanka. Average plot sizes range between 600 - 5,000 sq. ft. with prices ranging from INR 25 lakh to beyond INR 3 crore.
- Pune - major micro-markets include Wagholi, Undri and Talegaon Dabhade, among others. Average plot size range between 600 - 6,600 sq. ft. while the prices start as low as INR 14 Lakh.
- Chennai - prominent locations with plotted developments are Iyappanthangal, Puddupakkam, Vandalur and West Tambaram, among others. Plot sizes start from 560 sq. ft. and are priced from INR 14 lakh onwards. There is a high demand for plots priced within INR 50 lakh.
- MMR - major micro-markets for plotted developments include Neral, Warai, Shahpur, Palghar, Boisar and Khalapur, with many projects in the pre-launch stage. Plot sizes here is fairly larger than in the southern cities, starting at 1,600 sq. ft. with prices beginning at INR 16 lakh.
- Gurugram - major micro-markets for recently-launched plotted developments include Sohna and Sector 72. Plots are priced at INR 30 lakh and above.
- Hyderabad - markets with new plotted developments supply include Rajendra Nagar, Shadnagar and Serilingampally, with average plot sizes ranging between 1,200 - 8,000 sq. ft.
A Win-win Proposition
As Mark Twain put it – ‘Buy land, they’re not making it anymore.’ In India, investment in land is a time-honoured tradition and COVID-19 has further strengthened demand for land as a long-term investment. Some buyers are even considering plots in gated societies and build on and use, as standalone homes are the safest bet in a pandemic situation. The rise of the work from home culture is also closely interrelated here.
Demand Drivers – Buyers
- The relative affordability of plots compared to built-up real estate
- Potentially good returns on patient land investment
- Proposed infrastructure projects in city peripheries provide a strong rationale for invest in land now and reaping the benefits on their completion
Demand Drivers – Developers
- For developers, plotted development is a smart strategy to liquidate land banks for raising working capital
- Minimal capital investment, limited project execution risks and faster exit opportunity
- Plotted developments by branded developers are in highest demand