DELHI: The real estate sector in India is on a high growth path, and IT industry has a major role to play. The influx of IT set-ups across India has given a push to the demand and supply of residential as well commercial space in the country. However, consumers still face the dilemma of whether to invest in an IT-driven city or not. Kalpana Murthy, Associate Director, Residential Services, India, Cushman & Wakefield explains how property investment in IT driven cities can fetch good returns. She took consumer queries on Magicbricks chat forum GuruTalk. The topic of discussion was ‘Investing in residential real estate in IT driven cities’.
Talking about non- IT cities such as Mumbai and Delhi, Murthy said, “These are very different markets. The increase in capital values has more to do with supply and locational advantages whereas, IT driven markets emerge and largely grow due to government policies, talent pool, subsidies and relocation & expansion strategies of IT/ITeS companies.”
“The advantages of investing in residential apartments along the IT corridor are significant for most of the IT driven markets. Focus on physical and social infrastructure attracts migration of families and talent pool specific to the IT industry and encourages corporate or IT companies to relocate and expand their establishments in such markets. This would enhance the increase in capital values for the investors and satisfy an end user with good amenities and living comforts,” explained Murthy.
Keeping a 3-5 year horizon, Gurgaon and Noida Expressway in Delhi NCR, Mysore in Bangalore and Hinjewadi in Pune are few locations that can get good return on investment, she said.
However, she suggested that if the buying is for investment purpose, it is not an appropriate decision to invest in a higher land value location whereas, if the buying is for end use having the advantage of accessibility to work, it certainly makes sense.
Talking about IT companies shifting their interest towards tier II cities, Murthy said, “IT companies are focusing on cities which would drive demand from talent, resources, cost of living and connectivity. The decision also depends on the cost of capital to set up their operational base. Nagpur near Mumbai will soon see IT boom.”
Giving a last piece of advice to consumers, Murthy said, investing in IT corridors supported with government initiatives on infrastructure, development in the periphery of any city would be a good option for investment for end-users and investors both.