As the real estate slump takes its toll, investors who played a major role in keeping the market afloat have disappeared, leaving only end users who are reluctant to buy. Add to this government manipulation of circle rates and even the most resilient property markets are showing signs of stress. The Delhi property market has been one of the worst hit with prices tanking. We list 5 localities in Delhi where prices have dropped the most.
1) South Extension Part 1
The neighbourhood of South Extension 1 is one of the wealthier neighbourhoods of Delhi and is famous for its numerous shopping centers and restaurants. However, the region has also been one of the worst hit by the real estate slump with property price plunging a whopping 31% over the past 3 years, from an average of Rs 18,900 per sq. ft in 2013 to about Rs 13,000 per sq. ft today.
2) Shanti Niketan
This can arguably be called the most exclusive residential zone in Delhi with the value of property transactions happening here running into Crores. But this tag of exclusivity was not enough to spare property prices, which fell by 26% over the past 3 years. From Rs 37,400 per sq. ft in 2013, it has dropped to Rs 27,600 per sq. ft in 2016.
3) Tilak Nagar
Here too, property prices have fallen by 26% with prices dropping from Rs 5,525 per sq. ft to Rs 7,500 per sq. ft today. Real estate experts also claim that much of the drop is on account of pollution, traffic congestion and the locality’s proximity to industrial zones.
Why are Delhi property prices falling?
– Government has been increasing circle rates in spite of market rates being lower. High stamp duties have kept potential buyers at bay.
– Delhi is also facing competition from more affordable property markets in Noida, Gurgaon and Ghaziabad.
– Buyers are ditching expensive localities for homes constructed by the Delhi Development Authority (DDA) or at unauthorized colonies, both of which have fewer amenities, but are much more affordable.
4) Mukherjee Nagar
North Delhi too has been impacted by the slowdown. Property prices here have fallen by a whopping 25% to 30% in the last few years and Mukherjee Nagar has been the worst hit, with prices falling by 30%. From a high of Rs 12,850 per sq. ft, Mukherjee Nagar is now seeing prices as low as Rs 9,000 per sq. ft.
Pitampura is famous for being a hub for government offices, thanks to the DDA setting it up as a planned neighbourhood over 3 decades ago. It is also considered one of the more luxurious parts of Delhi to live in and is famous for its eateries, branded stores and clubs. However, the absence of new projects and higher than average prices have scared home buyers away, leading to prices dropping by 24% in the past 3 years. Real estate experts believe that this downfall in North Delhi will continue further, at least for the next 2 years.
Is this the right time to invest here?
Real estate experts don’t expect prices to increase anytime soon and in fact say the implementation of Delhi Masterplan -2021 could see prices go down further. Their advice: Go ahead and scout for properties because you may not get these options at the same prices once the markets pick up, but make sure you negotiate hard on the price.
Reporter- Chanakya Bhatia
Edited by- Nikhil Narayan Sivadas