Monday, May 07, 2007

Skyscrapers in Pune

Pune deserves priority mention in the real estate headlines, though not only for all the hyped reasons. On the positive side, Pune's property market is definitely on a roller coaster ride, not least of all because the city is on the verge of seeing its first
high-rises. The in-principle permission granted for this is significant because until now, the maximum permissible height of a building in Pune was 30 meters. With this development, it is 100 meters.
There are some regulations for this, as well - however, it basically means that Pune will see its first skyscrapers with a few years. Many builders are planning in this direction and some landmark projects are scheduled to come up. This will happen sooner (within a year) in special townships that meet the approvals of the Mumbaibased Fire Advisor. It will take longer for the rest of Pune (up to two years) because it still has to come within the Development Control Rules.
On the downside, property sales in Pune are currently rather sluggish and because of this developers are taking it easy. Rates have stabilised, though there might be an upward swing in rates in three or four months in certain areas around the Mumbai Bangalore bypass from Hinjewadi to Dhankawadi, with a minor upswing on the Eastern side in areas like Kharadi and Hadapsar.
On the residential property side, Pune's developers would do well to take a less adamant stand in terms of pricing their projects. There is little justification for the manner in which they persist in pushing the rates up, and they should be aware of the fact that this will eventually have a spiral effect based on outraged buyer sentiments. It would seem like a good time for them to concentrate on adding volume rather than adding to the prices of their existing properties.
On the commercial property front, there is likely to be an oversupply of space in Pune if all or most of the announced projects actually take off. This will naturally have a downward effect on rates. For those intending to buy into potential appreciation in an area where a major mall is scheduled - watch and wait. There is very little happening in terms of actual launch and construction of these developments.

No comments: