Urbanisation: Can We Reconnect Our Cities With Nature?

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

In pre-modern times, people in Indian cities still coexisted peacefully with nature. Sadly, in the current real estate development scenario, we have definitely witnessed an increasing separation between nature and individuals.

In the pursuit of their development and urbanisation agendas, our cities have seen high-rise buildings replacing backyards, parks and forested areas.

However, it is wrong to blame solely real estate developers and municipalities for this scenario. They are effective reacting to the growing demand for such buildings from people whose evolving lifestyles focus more on work and after-work entertainment and shopping.

Let us take the city of Pune as a case in point. In previous times, this city had a much smaller geographic spread and there was no real need to increase it.

Pune was supposed to be city for retired people. The city and its trade activities coexisted very well with a strong agrarian component both in the central and peripheral regions.

Population growth was relatively limited. The neighbouring city of Bombay, established by the British circa 1845 as a major port and trade hub, attracted a significant mass of migrants looking for urban-based employment.

In fact, the British viewed Pune – or Poona, as it was known in earlier times – as a region of political unrest and resistance against their rule. Pune began growing both in terms of population and geographical spread only after India attained independence in 1947.

Then came Pune’s Technological Revolution.

Pune transformed from a relatively small city to a full-fledged metropolis and was drawing a massive influx of people responding to its rapidly increasing employment opportunities – first in manufacturing, then also in software technology and information technology-enabled services (ITeS).

When Pune was still relatively small and untouched by the rampant urbanisation we see here today, there was negligible impact on the natural wealth for which it was once so famous.

Today, we see its once generous share of green open spaces eaten up by both low-rise and high-rise housing developments, landfills, commercial complexes and shopping centres.

Sahakar Nagar Pune
Sahakar Nagar Pune

As a result of this process, city dwellers become disconnected from nature. It is true that there is a lot of awareness and concern about the need to reestablish a healthy environment, and healthier cities.

However, it is also true that most real estate development taking place today is about amenities and facilities, and that any vegetation that is factored in is merely aesthetic and ornamental.

Essentially, the city has gone from green to grey, and any new thinking about and efforts towards reconnecting people to nature must indeed be trans-disciplinary and coordinated.

Construction is an inseparable element of a city – a city without buildings is inconceivable, and deforestation is inevitable. In fact, the very genesis of buildings lies in mankind’s need to protect itself from the wild animals inhabiting forest areas with strong, impregnable structures.

Today, wildlife has been more or less wiped out from our cities, but economic inequality has given rise to new threats of forced entry and loss of life and possessions. As long as mankind prevails, buildings will prevail as well – but can we bring nature back into our cities, as well?

An experiment to achieve exactly that is reaping astounding results in cities like Singapore, where a natural ecosystem is being re-introduced into the urban fabric. It is astounding what such a vision of futuristic urbanisation can achieve.

Clearly, concrete can coexist with abundant greenery and one must not necessarily negate the possibility of the other. However, it takes a magnificent town planning vision, coupled with a strong political will – and also unswerving support from a city’s population.

As long as demand for homes is skewed only towards concrete buildings with modern amenities and some token greenery, only such supply will follow.

Increased demand for urban housing where natural environment is more than just a token gesture and, in fact, available to sufficient saturation to actually have an environmental impact, such supply will surely follow.

We are seeing the return of such demand in Pune, and it is driven not only by the higher environmental consciousness of today’s young homebuyers but also their concerns about their own and their children’s’ health and wellbeing.

A city does not lose its ‘green’ identity overnight – in cities like Pune and Bangalore, the erosion of this identity took several decades.

It will take a few more decades to bring it back, but it is possible if all stakeholders – from town planning and municipal authorities to real estate developers and buyers – decide that it is worth it and must be done.

About The Author:

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

What Lies Ahead For The Pune Property Market

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

Pune’s real estate market is the stuff of legend, and justifiably so. All the five main verticals of the property sector – residential, commercial office space, retail and hospitality – are performing optimally in Pune.

This is by all standards an exceptional real estate market. Moreover, Pune is always growing and adding to its geographical spread, making it by far the largest and most vibrant real estate market in Maharashtra and beyond.

Therefore, it comes as no surprise that investors from Mumbai, dissuaded by the high property rates and slow market conditions in the financial capital, are extremely active in Pune.

Apart from these, there is a constant flow of investments coming in from other Maharashtrian cities like Nanded, Nasik, Sangli, Kolhapur, Nagpur, Jalgaon and Amravati. As a result, the Pune property market is extremely resistant to stagnation.

Know what drives demand

The huge degree of job creation the city’s manufacturing, automobile and Infotech and services sectors is causing inward migration from almost all parts of India and very rapid absorption of commercial office spaces.

This, in turn, is constantly ramping up residential property demand as well. Additionally, thanks to its many educational institutions, Pune boasts of constantly replenishing talent pool which fuels the growth of all the sectors active in the city.

Because of the multidimensional growth drivers that the city enjoys, the Pune residential property market is quite resistant to the severe demand fluctuations being seen in a number of other cities.

However, successful investment into the Pune residential real estate sector still calls for knowledge about what works, and what doesn’t.

Pune_India

Know where to invest

Like in every other city, Pune’s residential property sector sees the most rapid impetus in pockets or locations that are still developing. It is primarily in these emerging locations that we find the most real estate activity, both its terms of development and demand from buyers.

Areas like Undri, Ambegaon, Keshavnagar and Bhugaon have already established themselves as Pune’s fastest-growing new suburbs. The growth of such locations also serves the important purpose of decreasing demand and development pressure in the central regions. However, even in these areas, there is danger lurking for uninformed property investors.

In many of the emerging residential property destinations, we have seen a huge load of housing projects where construction has either been stalled or delayed far beyond the initially committed completion timelines.

Investors and end- users who bought into such projects at the pre-launch phase to take advantage of attractively low rates have literally become stuck along with the projects.

Know your developer

In Pune, the difference between beneficial and hazardous housing investment lies primarily in the reputation and credibility of the developer. While credibility is a much-abused qualification that almost every developer lays claim to, it is actually quite simple to verify.

One merely needs to examine the builder’s track record of successfully completed housing projects. ‘Successful completion’ does not mean ‘eventual completion’, but completion within 1-1.5 years of the delivery timelines promised to buyers.

RERA Compliance – the new Gold Standard

With the Real Estate Regulatory Act (RERA) slated to finally become a nation- wide reality by mid-2017, Pune’s residential real estate market is going to become more vibrant and lucrative for property investment than ever before.

Thanks to this key reform in the real estate sector, the city is set to shed a lot of its ‘bloat’ – or burden of small-time, inexperienced builders out to make a quick buck with small, shoddily designed and executed projects which are also often of dubious legal status.

Such players will simply not be able to sustain operations post-RERA, and will vanish from the market.

What will remain are builders of good repute, market standing and track record – credible players who are able to abide by the strictures that RERA lays down to protect the interests of buyers and investors.

While this landmark is understandably a source of fear and trepidation for fly-by-night builders, it heralds the even more powerful emergence of strong, credible developers.

About the Author

Kishor  Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd.  is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Pune Property: All Roads Lead to Ambegaon

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

No discussion on Pune’s property boom locations is complete without an extensive evaluation of Ambegaon.

An increasing number of Pune’s homebuyers are opting for areas with generous natural endowments and absence of the crush of the city’s central areas.

As Ambegaon offers superb connectivity in addition to a green, hilly environment, it has naturally emerged as one of the most favoured property locations in Pune.

As a matter of fact, Ambegaon will be one of Pune’s most exciting property boom regions for several years to come during the following ten years.

Apart from its abundant greenery, the backdrop of hills and excellent connectivity, it is also an eminently affordable location.

Moreover, it offers a good spread of housing options, from multistoried apartment projects to luxury townships.

Ambegaon is also close to the new MIDC in Shirval, which is a massive employment hub which has given rise to ever-increasing demand for both budget and premium homes here.

Some of Pune’s leading developers have responded to this demand with projects that bear the brand of reliability, are very suitably priced and additionally offer tremendous investment appreciation value.

The growth of Ambegaon has been partially because of the spill-over demand from Sinhagadh Road, which has developed very rapidly and seen unattractive price growth as a consequence.

But one of the leading factors for Ambegaon’s quick rise to fame has been the fact that it gives property buyers a diversified choice of homes, ranging from premium bungalows and villas to budget flats.

This location’s natural ambience and absence of congestion and pollution lend it a distinct aura of exclusiveness, simultaneously providing homebuyers a welcome option to live and raise their families in bracing, naturally blessed surroundings.

Residential areas with the kind of abundance of trees and green open spaces available in Ambegaon are home to healthier and happier people, and have a cooler climate than the inner-city concrete jungle.

It is no accident that Pune’s core city dwellers tend to be more susceptible to suffering from conditions like asthma, bronchitis and hypertension – most of the city’s previously splendorous green cover has been eroded by real estate development.

In contrast, Ambegaon is a haven of peace, calm and greenery – the hallmarks of Pune’s glory years.

Moreover, Ambegaon is constantly seeing upgradation of its support infrastructure by the Pune Municipal Corporation – a very important factor driving property investors’ interest in this location.

Investment appetite here is also because of the accelerated development of places like Bavdhan, Sinhagad Road, Wagholi, Bhugaon and Undri.

These locations have for long been catering to the demand for quality housing coming from employees of Pune’s Information Technology sector, but Ambegaon additionally gains from its proximity to the Pune-Mumbai Expressway, the famous Sinhagad Technical Institute and the Bangalore Bypass.

In other rapidly growing locations of Pune like Baner, Wakad and Hinjewadi, the predominant demand for investment properties comes from neighbouring Mumbai.

Ambegaon, on the other hand, has unique location advantages, Ambegaon is also a hot favourite with investors from cities like Sangli, Satara, Kolhapur and Shirval.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

What Makes A Real Estate Investment Location Lucrative?

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

A simple Google search on real estate investment locations will throw up hundreds of results. Finding genuine online advice – the kind that can lead you to a truly lucrative real estate investment decision – is like finding the proverbial needle in the haystack.

The Internet’s usefulness as a tool to guide your property investment decisions depends upon the individual’s capacity to read between the lines of a mammoth amount of information which may or may not lead to house one is looking for.

Year 2017 should be a year for residential real estate investment, as the Government is ensuring low interest rates and a slew of incentives via schemes such as the Prime Minister’s Awas Yojana (PMAY).

So, interest in and appetite for real estate investment is back in force – but where should one invest? After all, successful real estate investment is proverbially driven by ‘location, location, location.’

When you are trying to identify the right location to invest in, you are obviously ready to put up a lot of saved or leveraged capital. This is no time to rely on sponsored advice and blanket generalizations.

What must come into play here is some basic knowledge of what makes the real estate market tick, and more specifically what drives demand in any location. The viability of a location is what will result in the hoped-for returns on investment.

So, how does real estate location viability actually work? From a residential property investment perspective, every city – especially if it is a tier 1 city – has its hot investment corridors, and other micro-markets which are simply not working currently.

Some of the important real estate drivers to look for are employment generation, infrastructure creation and historic price growth.

Mumbai, being the country’s financial capital, has been attracting massive investments over the years despite its astronomically high ticket sizes.

Bangalore has become India’s prominent Information Technology capital and been attracting consummate investments.

However, Pune has begun stealing Bangalore’s thunder as a preferred InfoTech destination, owing to:

  • Better real estate affordability
  • Global reputation for Business Process Outsourcing (BPO) services, and
  • Massive wealth of trained workforce.

The third factor is a very important one, and plays a big role in the city’s viability as a real estate investment destination.

Pune Mumbai Bengaluru

Pune – the veritable ‘Oxford of the East’ – has numerous high-quality educational institutes which regularly churn out graduates who are directly absorbed not only into the city’s IT firms but also into its manufacturing belt and services sector.

This directly translates into housing demand across a broad budget band, and in various locations of the city.

All such cities have micro-markets which are suitable for either commercial or residential investment, and others that are probably avoidable right now.

Because of the amount of business Mumbai, Bangalore and Pune generate – and the fact that they are in the cross-sights of many large commercial players – these cities are excellent choices for commercial space investments as long as:

  • One picks one’s location and property size wisely
  • Achieves a reasonable entry point in terms of ticket size

Commercial real estate investment calls for larger capital and longer investment horizons, and ROI is generally derived from rental income.

Areas which are close to relatively affordable residential catchments or at least provide good connectivity to them should be favoured.

When it comes to residential real estate investment, it pays to remember that speculative investments may have played a role in escalating prices beyond affordability in some areas.

Several factors have now combined to drive out speculators from most Indian cities, and price corrections have occurred. If the prices have bottomed out or the location is still in growth mode, it is a good time to invest in it.

One should look for factors like proximity to workplace hubs, infrastructure availability – especially in terms of connectivity and public transport – and a decent saturation of social infrastructure such as shopping outlets, healthcare and schools.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Pune Real Estate – Green Is the New Gold

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

If we look at Pune’s real estate landscape, it is quite evident that the city has taken a hit in terms of its previously legendary green cover. This is of course unavoidable in the urban areas, which must accommodate the constantly growing population in the city.

This is the price we must pay for growth, which is ultimately good for the economy. However, there’s no escaping the fact that there is a deep link between green environment and the quality of living that a city’s residents enjoy.

Residential neighborhoods that are bestowed with trees, foliage, lawns and natural open outdoor spaces also have healthier and happier people. This is by no means just a romantic concept.

The existence of green spaces actually contributes to air quality, as trees and other greenery absorb toxic pollutants like sulphur dioxide, carbon monoxide, nitrogen, ammonia, nitric acid vapor and ozone – and give back life-giving oxygen. Greenery and green open spaces also play a major role in controlling urban temperatures.

Just a decade ago, Pune was known for its abundance of green cover, which generously embraced almost all of its residential areas. Today, a lot of this green cover has gone under the development hammer with the unconstrained proliferation of real estate and massive industrialization.

This, coupled with road development and the unbelievable increase in traffic movement within the city, has given rise to serious health issues now cropping up into once healthy neighborhoods.

As a result, today Pune’s citizens are far more prone to suffering from ailments like high blood pressure, bronchitis, asthma, depression and overall stress. A city that was once an epitome of modern natural living is now starved for oxygen and visual relief from the ever-expanding concrete jungle.

Though a green environment evidently benefits everyone, it is particularly important for the very young and elderly. Children obviously thrive most in green surroundings, and senior citizens living amidst sufficient greenery have fewer health problems and lead a considerably fitter lifestyle than those who live in an environment of unrelieved concrete inside the city.

The more the availability of greenery and green open spaces in a residential neighbourhood, the likelier it is for its residents to spend time outdoors and avoid a sedentary lifestyle.

Without a doubt, life in a city should not be merely about owning a beautiful home, but also about being happy and healthy. As the world continues its fight against global warming and urban areas grow, home buyers in cities like Pune are starting to prefer neighborhoods that have amenities like parks, gardens and enough natural green cover.

sahakar nagar pune
Sahakar Nagar, Pune

Locations like Undri and Ambegaon, where the benefit of protected green cover is still available, score high on their preference list – not only because of their greenery but also because they are also more price-friendly than the congested inner city areas.

These are also among the most preferred locations for property investors; as Pune continues to develop rapidly, its greener areas will eventually command premium prices.

After all, green cover is the pièce de résistance that gives luxury areas like Sahakar Nagar, Koregaon Park and Boat Club Road their unique appeal. And for home buyers, it’s not just about giving kids the opportunity to play outside but also living in a healthy environment – and a more active and vibrant community.

Green spaces in and around residential projects have been proven to bring people outdoors to engage in healthy interactions with neighbors. Common gardens and parks are spaces where people meet and spend time together.

Consequently, people who choose greener living spaces over concrete jungles enjoy better social bonding, are more concerned about the development of their community and neighborhood – and live longer and happier lives.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Pune Real Estate: The Year That Was, And The Year Ahead

Kishor Pate, CMD – Amit Enterprises Housing Ltd.

2016 did not bring as much cheer to Pune’s real estate market as previous years had. Nevertheless, Pune outperformed Mumbai by between 20 to 25% in terms of overall sales.

The highest-selling category in Pune was mid-range properties priced between Rs. 35-50 lakh within the city’s municipal limits and its nearby periphery, followed by lower budget housing on the outskirts priced between Rs. 15-30 lakh.

The latter pricing category offered on the market saw some response; however, whether it sustainable is debatable.

The questions which bothered most buyers in 2016 were:

  • What are the hidden cost?
  • Does the location serve my purpose?
  • Will the project I am interested in be completed as per promised timeline?
  • Is the developer inherently RERA-compliant?

Due to these completely understandable apprehensions, reputed builders saw the most number of serious inquiries in 2016. It would not be an exaggeration to observe that the year saw developers being examined with microscopic scrutiny.

There was clear evidence that Pune’s property buyers have become very aware of their rights, and that they can expect their interests to be protected by the upcoming RERA; promoters will not be able to dictate terms as they so far have.

However, irrespective of the potential protection that RERA will provide, buyers were more focused on the reputation of the builder than prices.

This was a significant change of temperament among Pune’s traditionally price-sensitive consumers. It indicated that long-term investment value and growth now matters more to them than short-term savings.

More than ever before, the inherent value of sticking to players with an established track-record will make itself felt in 2017.

When RERA becomes a nation-wide reality in mid-2017, Pune’s established developers with a good track record quality products and transparent dealings via official financial channels will emerge as dominant.

Once the Real Estate Regulatory Bill kicks in, fraudulent builders will be pulled off the market, and there will be more clarity than ever before about the genuine opportunities that Pune’s real estate market offers.

For the entire year of 2016, Pune remained a buyers’ market and primarily end-user driven. Developers vied with each other for customers in most locations – a ‘competition’ in which only those with projects nearing completion emerged as clear winners.

High buyer caution prevailed throughout the year with regards to pre-launches and under-construction projects in the earliest stages of development.

With many projects offering ready-to-move options to buyers and investors, the thought of having to wait for 2 to 3 years before gaining possession simply failed to entice.

The locations which scored highest with buyers in 2016 were not the overpriced central locations, but those which offer good connectivity to Pune’s various workplace hubs while circumventing the steep price points of the city’s central areas.

property investment

Most buyers had a firm list of must-haves to refer to:

  • Proximity to the city’s various workplace centers; good overall connectivity via roads and public transport
  • Rational property prices
  • Availability of good schools, affordable healthcare, shopping and entertainment
  • Market-proven reliability of developers’ brand

In terms of location, Undri-Pisoli in Pune’s south-eastern sector was a clear favourite with buyers employed in the city’s Infotech sector and manufacturing industries, as all the requirements were available as above,

Also Ambegaon in the south-western part saw a lot of conversions, thanks to its good connectivity to Mumbai as well as onward to Satara and Kolhapur.

Apart from the fact that these locations are extremely well-connected, they also drew demand because they have a good supply of completed projects by reputable developers.

Fast-paced infrastructure deployment also helped bring these two locations to the top of the charts in 2016, and will continue to sustain their desirability in 2017.

Bhugaon, Keshavnagar and Manjri in the city’s eastern quadrant saw a lot of absorption because of overall access they provide to various key areas of the city. Though they are still emerging in terms of general infrastructure deployment, these are certainly locations to watch in the future.

In terms of general pricing, Pune saw a correction of 3 to 6% in property prices in most markets. Most developers rolled out additional schemes to attract buyers to their projects, with varying degrees of success.

Construction-linked plans drew some interest, but the clear winners among such schemes were all-inclusive packages which included all statutory costs such as VAT, stamp duty and registration fees.

Buyers showed a lot of preference for transparency in pricing, a decent saturation of in-project amenities and facilities, and developers whose trustworthiness was not in question.

2017 will be a year of significant and much-needed change for Pune’s property market. The Government’s demonetisation initiative has kick-started a process of elimination of fly-by-night developers and the cash components in the transactions will come to an end- a process which the final implementation of RERA will bring to culmination.

There will be a lot of consolidation throughout the year, with such players yielding whatever marketable land parcels and incomplete projects they hold to more established players.

2017 will not bring any further correction in Pune’s residential property prices, as demand is already returning in force to the city’s property market. Also, the fact that RERA will bring with it a significant additional financial burden on developers with regards to various statutory compliances, prices may go up towards mid-year.

Nevertheless, the year ahead will be favourable for property buyers in Pune. It will continue to be a buyers’ market, and the relationship between developers and buyers will see a major upgrade because buyers’ rights and interests will be well-defined and well-protected by the new Real Estate Regulatory bill. This is what the Government wants to achieve.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

How Education Influences Pune’s Property Market

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

Jawaharlal Nehru named Pune the Oxford of the East, and this title is more than well-deserved on account of the many schools, colleges and management institutes that the city boasts of. Each year, Pune attracts tens of thousands of students not only from India but all over the world.

A lesser-known fact is that Pune’s real estate market is a direct beneficiary of its highly developed educational environment. People in Pune are willing to invest considerably in their children’s education, and this includes a willingness to pay more for a home located close to a good school or college.

In fact, if we study the check-lists of features that most homebuyers in Pune consider important, more than 35% list proximity to good schools and colleges non-negotiable.

Also most of the migrants from other states generally fall in love with Pune and settle here. This also leads to demand for more houses  near the proximity of the schools as this is a most logical step for anyone to raise a family.

Not only that, but a significant number of homebuyers – predominantly young working couples – are willing to compromise on other aspects such as proximity to entertainment and even workplaces in order to secure a home close to a good school.

For these people, the welfare of their children ranks higher than their own convenience. What is even more interesting is that not all of these homebuyers are married or have children. Why do such buyers consider proximity to good educational institutions important while selecting a property?

The answer is as simple as it is profound. On the one hand, married homebuyers with children are definitely interested in quality schools and colleges because of the educational opportunities they offer. Such homebuyers have either just starting a family or are planning to do so soon.

Either way, they are considering the future of their children and are even ready to pay more for smaller homes in order to secure their chances of a good education.

In the larger context, however, most property buyers and investors in Pune understand that the availability of good schools in a neighborhood contributes directly to the overall value of the locality’s real estate.

Obviously, Pune’s educational districts rank very high as property investment destinations. This is underscored by another very interesting fact – namely, the resilience of the property values in areas of Pune which are close to the good schools, colleges and management institutions.

child in school

In the past, these areas did not see any drop in property prices even when other localities were seeing price corrections.

Historically, homebuyers focused on these areas of Pune were willing to make all kinds of compromises in order to secure the education advantage. They were ready to settle for smaller homes in projects without clubhouses and swimming pools, in congested areas without malls or any kind of organized shopping nearby.

Over time, these constraints have given way to some extent. Developers who were able to secure redevelopment rights in some of the core areas of the city were able to build more modern residential complexes which have a decent share of lifestyle amenities.

While examining the correlation of Pune’s educational institutions and the property pricing in the areas around them, some may argue that good schools and colleges have led to the higher appreciation of these areas.

The rationale would appear sound – homebuyers in Pune will always prefer residential projects located near an educational district and are ready to pay higher rates for them. So have Pune’s good schools, in fact, helped drive up the property prices in these localities?

Maybe so, but this is an incomplete argument at best. The fact remains these areas are also defined by higher historic affluence and that this affluence has triggered the development of high-quality schools there. There is no doubt that in Pune, the best schools and colleges are in localities defined by a higher standard of living.

In the final analysis, what perhaps matters most from a property market perspective is not the nature of the relationship between education and property values in Pune, but the simple fact that the relationship definitely exists.

Developers with projects in and around Pune’s educational institutions are able to ask for higher prices, and homebuyers are generally willing to pay them.

About The Author

 Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township, Astonia Royale in Ambegaon.

Pune’s Real Estate Market – At The Cusp Of Revival

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd

It’s a much-asked question – is this the right time for first-time home buyers, or should they wait as there is another price correction expected? In a price-sensitive real estate market like Pune, this question has been asked for more than a year now, and the market’s answer has been quite consistent.

There appears to be no possibility of  further price corrections in Pune. Demand in the right locations and at the right price points has returned, which means the right kinds of properties are selling. Rather than a price correction, it appears that  it is likely to be appreciation which is on the cards once again.

First Homes Market – Returning Rationale

The prolonged market slump from which many of the Indian cities are only now beginning to recover certainly served an important purpose – that of bringing property prices down to their lowest possible levels.

As market pundits have correctly pointed out, the only way for inherently strong markets like Pune is up going forward. However, as of now, the advantage still lies squarely with the buyer. The current time is, in fact, optimal for first-time home buyers to make their play.

For a while now, property valuations in Pune have been at their lowest point. Also, there are very good value-adding offers available, especially in terms of innovative financial structuring.

The financial burden of buying a home in Pune has indeed never been easier to bear than today. Many leading developers are now proactively assisting buyers to reduce the financial implications of buying a home in their projects by way of attractive schemes.

Among the most successful offer available in Pune right now is, all-inclusive rate packages, which include all the usual add-on costs such as stamp duty, registration and VAT.

EMI holidays have also found some favour, though buyers considering such a scheme must definitely carefully study the fine print and long-term implications of the offering.

Second Home Market – Once Again Gaining Traction 

Apart from the first-home market, we are also seeing a revival in Pune’s second home market. Buyers who have been hoping to buy second properties to house their extended families or as investments are finding this the ideal time to make a decision for purchasing the second home.

However, to accurately gauge the exact nature of the revival in Pune’s second homes market, one needs to understand its exact nuances. It is a common error to equate second home with holiday homes in remote locations.

real estate development

This particular market segment, in fact, continues to languish across the country for lack of demand. It usually thrives only during periods of prolonged economic prosperity and protracted vibrancy on the primary homes market.

It is only when people have been secure in their jobs for a sufficiently long time and seen a series of salary hikes that they see any rationale at all in investing in ‘non-performing’ real estate assets like holiday homes. During any other time, they will usually focus only on buying properties which serve the primary need of accommodation or rental income generation.

Investment Advice

Regardless of whether one is looking to buy a first or second home in Pune, the basic success fundamentals remain the same. One should go for locations which are close to primary workplace areas which have a good saturation of office complexes, if one can afford it.

Other important aspects to focus on are the availability of good social and civic infrastructure like schools, hospitals, shopping, etc., and presence of public transport.

With regards to whether one should opt for under-construction or ready-to-move projects – both options have their distinct individual merits, so it is not an either-or scenario at all.

While under-construction properties cost less, one should only consider this option if the developer is reputable and has a good track-record of timely completions. Currently, some builders are offering attractive packages even for ready possession flats – serious end-users and investors should certainly not miss this chance.

Finally, a guideline to pure investors (as opposed to pure end-users) for managing expectations is in order. High capital appreciation may not be a factor in Pune at the moment, which is precisely what has led to the amenable prices prevalent on the market today.

Pune’s real estate market currently stands at the cusp of revival; it is expected that it will take at least 2-3 years for substantial appreciation numbers to become a norm again across all locations.

The investment factor to zero in on currently is good rental potential, which is certainly a possibility in high-performance locations such as Undri, Ambegaon, Wagholi and Bhugaon. For optimizing rental income potential, the flat’s size, amenities, location and builder’s brand value must be considered as integral.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Should You Buy A Home In Pune This Festive Season?

Kishor Pate, CMD – Amit Enterprises Housing Ltd.

There are many reasons why people decide to get off the rental housing bandwagon and buy their own homes. One of the most important ones is that a self-owned home is an investment-grade asset which appreciates and safeguards one’s financial future.

Also every family has a cherished dream of having their self-owned house, which is a lifetime shelter for them as well as for the future generations.

Having a home of their own is the fondest wish of every Indian family. Among other things, the Indian festive season celebrates wealth and prosperity, and nowhere is this spirit displayed more strongly than in Maharashtra.

woman holding diya

For realizing the cherished dream of a self-owned home, all aspire to look for property during the festive season. Even from an investment perspective, buying a home in Pune makes more sense than ever before.

Property prices on Pune’s residential real estate market saw year-on-year appreciation to the tune of 7.9% last year – and though appreciation has moderated somewhat this year, the current market readings are still between 5-6%.

Price growth has been moderate in 2016 so that buyers are not discouraged from making purchase decisions, especially during the critical festive period.

However, given the positive investment scenario and increasing demand for office spaces in Pune, residential real estate demand in the city is going to pick up tremendously in the future. This increased demand is bound to exert upward pressure on housing prices.

In the last quarter of 2016, sentiment on the Pune residential property market has seen the return of outright positivity, and areas that offer better affordability and returns on investment have been receiving healthy traction.

Most of the residential project launches in the city have been in the North-West and North-East regions, with the highest demand for housing emanating from the IT/ITeS, BFSI and manufacturing workforce. Areas like Ambegaon, Kharadi, Hadapsar, Balewadi, Hinjewadi, Nagar Road and Wagholi and Nagar Road have continued to attract good demand on the basis of improved connectivity with the key business districts.

However, it is the fringe areas of South-East Pune – specifically Undri and Pisoli – which have seen the most notable pick-up in demand, leading to a significant number of launches over the past few quarters.

Relatively lower property prices and good connectivity to central areas with their reputed schools, hospitals and other important social infrastructure has led to the strong emergence of South-East Pune as a real estate contender.

All in all, given the attractive offers and pricing schemes from developers and the continued affordability of the city’s emerging areas, this festive period brings with it a strong rationale for homeownership.

For investors, the time is right to identify the hottest growth corridors and make their play before they miss the most favourable entry point and have to contend with higher prices in the future.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Pune’s Suburban Real Estate Transformation

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

One does not tend to think of Pune a Metro city, especially when compared to neighboring Mumbai. Unlike Mumbai, however, Pune has the benefit of being able to grow spatially and it has been doing so at a very rapid rate.

With the constant absorption of surrounding villages, the city will at some point overtake Mumbai in terms of developed and developing urban areas. Even today, Pune’s suburbs account for a massive geographic spread – and these suburbs are seeing the highest rate of affordable and mid-range housing development.

As of today, Pune’s suburban market includes areas like Ambegaon, Undri, Baner, Pashan, Warje, Bavdhan, Dhayari, Katraj, Mohammedwadi, Mundhwa, Manjri, Hadapsar, Daund, Kharadi, Wadgaon Sheri, Dhanori, Pirangut, Hinjewadi, Kalyani Nagar and Koregaon Park, Wagholi, Chakan, Fursungi, Saswad , Katraj, Chikhli, Kasarwadi, Kalewadi, Phugewadi, Pimple Saudagar, Pimple Nilakh, Pimple Gurav, Tathawade, Thergaon, Talawade, Sangvi, Wakad, Dapodi, Hinjewadi, Bhosari, Pimpri, Chinchwad, Dighi, Nigdi, Moshi, Charholi Budruk, Ravet and Akurdi.

Given the vast multitude of locations in Pune which can technically be classified as suburbs, we can immediately see that some of them perform better than others. Suburbs closer to the city’s IT / ITeS parks perform best, as they attract steady demand from buyers with stronger budgets.

Because of this, such locations also see better civic and social infrastructure being put into place. Other suburbs have large integrated townships being developed. Many of the extended suburbs are currently seeing only budget housing being developed; however, as these suburbs see infrastructure creation and pick up on the back of spill-over demand from saturating areas close by, they see corresponding improvements in their profiling.

Contrary to popular belief the suburbs are, in fact, where the actual real estate action lies. In a growing city like Pune, the common misconception is that the most valuable real estate locations are in the city center. Of course, housing options in and around the center of the city will always see demand thanks to the proximity to the Central Business District and Secondary Business District.

However, many of the central locations are also unaffordable and congested. Developers are usually able to acquire only very small land parcels in central areas – plots which will accommodate only a limited number of flats in the housing projects.

astonia classic_night

Since the available space on such plots is very restricted, these developers offer very limited amenities or no amenities in these projects. As a result, residents have few of the benefits which a modern urban life should provide.

At the end of the day, what one sees is minuscule strangulated residential areas that offer little or no lifestyle accoutrements while simultaneously adding to the urban issues which defines almost all inner-city living in Pune today.

As a result, Pune’s peripheral suburbs and newly emerging real estate markets are the hottest residential property destinations, drawing considerable interest from residential property investors who are attracted by the high demand in these markets as well as the fact that property valuations have sufficient potential for healthy growth.

Some of the best-performing suburbs which host well-facilitated projects by reputed developers are Ambegaon, Undri, Hadapsar, Baner, Wakad and Hinjewadi. These suburbs are more or less driven by Pune’s burgeoning IT/ITeS sector which has proved to be the single-largest booster for residential and commercial real estate in the city.

While properties in and around the IT hubs tend to be too expensive to attract the bulk of end-user and investor demand, areas that are well connected to these employment generators while at the same time offering lower property prices are very hot tickets indeed.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.