Metro Railway – A Real Estate Game Changer

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Post By By Buniyad

01/23/2015

Today, many cities have come up or are coming up with modern rail systems. For an instance, if cities are living beings, transport networks would then be the arteries determining their growth and health. As India is becoming urban in character at an unprecedented pace, its cities are sparing no effort to expand amid the immense rush of people, are working extra time to upgrade their transport systems. Many are betting big on modern monorail and metro rail networks. Since upright connectivity is the singlemost massive determinant serving the development and hence real estate prices.

Mass transit system is thus a certain technique to boost the prices of the property in the city to about 20-25% annually, and this supposition has been proved right by Delhi, Mumbai, Bangalore in the past years of experience. Furthermore, jumping on the bandwagon – Chennai & Ahmedabad, armed with the government support with higher Floor Space Index (FSI), will certainly be witnessing immense scale metro track implementations. In  Delhi, Mumbai, Bangalore, it is metro, whereas in Chennai, this will be a monorail and on the other hand in ahmedabad, metro is underway.

In NCR & Bangalore, wherein the metro is fully-functional, The NCR’s metro project, the property prices in the localities are directly connected by the Metro significantly accelerated in a decent span of about 2-3 years. On the other hand, Bangalore’s Metro project is envisaged as a game-changer in terms of connectivity and will reduce both traffic congestion and commuting time & in turn will gain a decent jump in property prices. Vidhyadhar Naik, Bangalore Real Estate, Member NAR India and BRAI, has stated earlier, “Indira Nagar, MG Road and Baiyapannahalli, directly connected by the Namma Metro of Bangalore, recorded a year-on-year price appreciation of almost 20 percent.”

The story  of monorail in Mumbai was a clear cut revision of Delhi and Bangalore. In this context, Ramesh Nair, COO – Business, JLL India said, “The independent analysis of pricing unveils that the  proximity to a metro railway station could unassistingly account for a 22% variation in land value, besides factors like location, distance of the land from central locations and income groups.

Chennai metro might prove out to be the new face of Chennai, the prices of the real estate are likely to witness a substantial growth due to better connectivity in all the directions and is planned to connect Poonamallee and Kathipara with links towards Porur and Vadapalani. The project already has created strong buzz to take the realty sector by storm. A good hike in resale as well as new properties, mount in rental values, surged demand for small commercial outlets in the footprint of each metro station is likely to be noticed. Furthermore, according to Sanjay Chugh, Head – Residential Services, “People who are home buyers are seeking this as a convenient option to live where they can commute to their work places in mass rapid transportation system and we are sure to come across a huge traction and up to par escalation in prices in those areas.”

Ahmedadbad’s Metro project is planned to connect APMC to Motera Stadium and Thaltej Gam to Vastral Gam. There too, the Bus Rapid Transit System (BRTS) has generated inestimable demand for housing units in the affected areas, thus resulting in acceptable standard of price hike.

Though, the Metro project of both the cities are not actually implemented so far thus it is an alarm for the investors to make the most of the situation and cash-in on upcoming transport corridors. A timely entry and exit is all that could make a difference.

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