PUNE: Hinjewadi is an excellent example of how the development of an area as a commercial destination, leads to the growth in the residential real estate market too. Until a few years ago, Hinjewadi was seen as a rural area. However, the establishment of the Rajiv Gandhi Infotech Park changed the picture in a radical way. Today, there are more than 20 major IT industries in Hinjewadi, which are fuelling the residential demand in and around the area. The increasing demand for housing has led Hinjewadi to transform into a major residential hotspot with almost five per cent of the total projects in the city being launched here.
Another factor that has spurred a spate of residential and commercial property development in the locality, is its proximity to Mumbai. Both, end users and investors from Pune and Mumbai, are entering the real estate market of this area. “Buyers from Pune and Mumbai prefer Hinjewadi, specifically for its employment generation capacity, well-built connectivity and the scope for healthy capital appreciation,” says Sattar J Sayyad of Ashiyana Real Estate, a city based realty firm.
The locality has witnessed an almost three percent hike in the property values during the April-June 2013 quarter. Currently, the properties are available in the range of Rs 4,100 to 5,100 per sq ft. Unlike capital values, rental values in Hinjewadi have been at a low level for quite some time. The rental values in Hinjewadi remained stable during the October-December 2012 quarter and dropped by a significant 10 and eight per cent during the January-March 2013 quarter and April-June 2013 quarter, respectively.
Increased investor activity and over-supply are cited as the reasons for the drop in the rental values in the city. “Due to high rental demand from the working population, investors usually lease out their property to gain rental returns. This trend has slowly picked up and in turn, has led to ample availability of properties on rent. This easy availability of rental properties has resulted in a slump in rental values in the last few months,” Sayyad adds. At present, the rental values in the locality vary from Rs 12,000-16,000 per month for a 2-BHK, while a 3-BHK is available for Rs 13,000-20,000 per month – Rs 500-1,000 lower than last year.
Another possible reason for the considerable drop in rental values in Hinjewadi, is the availability of better options in nearby areas at lower rates. “Hinjewadi is a highly commercial place and buyers prefer to live here only to have access to their workplace. Social infrastructure, particularly the availability of good schools and neighbourhood markets, still leaves a lot to be desired,” informs Shakil Mujawar, owner, Dream Homes. He adds that the development of residential localities such as Pimple Nilakh, Pimple Gurav, Pimple Saudagar and Baner, all located within five-six kms of Hinjewadi, has impacted the rental demand in the area.
However, this does not stop the developers from making the most of this growing locality. Major developers having their ventures here, include Kolte Patil Developers Ltd, Green-World Developers, Sairung Developers and Paranjape Schemes (Construction) Ltd. Most of these projects are slated for possession in the next two years.
These trends suggest that the capital values in Hinjewadi may not go down soon but what needs to be seen is how the rental market revives in the coming time.