Residential Property Investment in Chennai
Chennai is the capital city of Tamil Nadu and is the biggest centre for cultural, economic, and educational developments in South India. The survey conducted by Mercer’s Quality of Living stated that Chennai is the safest city in India and has the third-largest expatriate population in the country. Chennai holds over one-third of India’s automobile industry due to which is rightly called the ‘Detroit of India’. The demand for residential property stems from the fact that the city is developing at a faster rate. The infrastructure developments, widespread IT parks, educational institutions, automobile industry, etc., have mainly contributed towards the development of residential property in Chennai.
Why invest in Chennai?
Facts such as a broad industrial base in technology, automobile, healthcare, and hardware manufacturing industries make Chennai one of the most sought out cities for investments in India. The residential real estate investments in Chennai have increased in recent years due to the influx of working professionals in smart cities. Initially, Chennai was an automobile market and educational hub, and now it is also home to several other companies and IT parks. The coastal city is well-known for its rich culture and tradition. Chennai’s residential real estate market’s progress is also dependent on infrastructure and connectivity developments in it.
People opt further for residential investments in Chennai due to its world-renowned healthcare facilities due to which it is informally addressed as “India’s Health Capital”. Transport, educational, and public utility setup are factors that have evolved and provide a convenient living experience to its citizens. Investing in the residential real estate market now can be an advantage as there is an increase in commercial investments in Chennai, and it is expected to increase job opportunities.
Growth Factors of the residential real estate sector
Chennai has been developing at a fast pace. One of the reasons for the same is the city’s educational prospect and employment opportunities and a decent lifestyle. With the increase in the population, the city also witnessed the real estate landscape spread across various zones, aiding further growth. Despite the challenges set up by the massive flood in 2015 and the pandemic in 2020, the city’s fundamental demand drivers remain intact. Thus realty market of Chennai is expected to continue on its growth trajectory, reinforcing in the following:
Mixed economic base: Chennai has an incredibly diverse economic base as several industries operate in it, such as the automobile, software services, hardware manufacturing, healthcare, and financial services industries. This diverse economic base is expected to gear the demand for the residential real estate sector in Chennai further as Chennai port, which is the second-largest port in the county, can be a crucial facilitator for import and export developments which would additionally result in the creation of ample job opportunities which in turn leads to the development of the residential real estate in the city due to the increase in the population.
Thrust on infrastructure: Another major factor fueling the development of the residential real estate sector in Chennai is the growth of its infrastructures, which helps ensure development not just in one region of the city but all around the city as better connectivity has been setup. Some of the major initiatives include Outer Ring Road (ORR), Inner Ring Road (IRR), East Coast Road (ECR), and the development of MRTS. The government’s interest in the infrastructure development in Chennai can also be evidenced from projects such as Chennai-Bengaluru Industrial Corridor, ORR Phase II, metro and monorail corridors planned to improve connectivity and accessibility to various parts of the city, thus not restricting the development to the main city. Better connectivity and better infrastructure have been drivers of the development of the real estate sector in Chennai as people started demanding residential property in the main city region and their neighbouring regions.
Expanding zones: the realty development is also driven by the fact that Chennai has a latent advantage over new zones’ overall development. It is only restricted by the Bay of Bengal on one side even though the city is free for development on all other sides.
End-user has driven: The Chennai market is largely end-user driven, and as a result of this, there is minimal speculation. The fundamentals of the realty market remain intact as the future growth potential is undisturbed. Thus the growth of the residential real estate market in Chennai is slow but stable.
Reputed developers: The economies and development of Chennai are not solely dependent on the local players as a few years ago, several other reputable companies such as Godrej Properties, Puravankara, Mahindra Lifespaces, Pacifica, PBEL, etc. entered the Chennai market.
The residential market in Chennai is driven mostly by those studying or working in Chennai that has migrated from other parts of India. Thus there is a direct relationship between commercial development and the demand for residential property. The commercialization and development of Chennai have also led to residential real estate development in the main city and the neighbouring localities. The demand for residential property is mainly in the affordable housing segment. Since the city attracts a wide range of NRI investments, it is also has a huge market for luxurious housing facilities. Assetmonk also offers investment opportunities in Chennai, such as sparkle towers and Panama Blue towers. Contact us for further details on the investment opportunities in Chennai.
Residential Property Investment in Chennai FAQs:
The cost of constructing a house in Chennai varies between Rs 1450 per sq. ft. to Rs 4500 per sq. ft. and higher in ultra-luxurious houses.
Some of the steps involved in selling houses in Chennai include finding the property’s price, conducting research on similar properties in your locality, finding an agent that can help you find potential buyers, and prepare your property well for the sales process and by marketing the property.
Some of the best areas to invest in Chennai includes Ambattur, Oragadam, OMR, Gudavanchery, Pallikaranai, Kelambakkam, etc.
Thoraipakkam, East Coast Road (ECR), Kelambakkam are the most common locations chosen by investors to invest in Chennai.
Buying a plot may be a better option as it is more flexible than a flat. The appreciation in properties is generally higher than that of the flats as well. However, in rental income, investing in flats may be a better option as it generates more revenue.