Dwarka Expressway: Despite increased supply, real estate prices are rising rapidly
In recent years, the region has witnessed a steep increase in housing prices in anticipation of the highway’s completion. | Representative image
Prime Minister Narendra Modi on Monday inaugurated the Haryana section of the Dwarka Expressway. Property developers and consultancies say this would be a game changer for the sector and lead to a further increase in supply in the region. However, it is likely that demand will exceed supply, leading to a further increase in property prices.
The 19 km Haryana section of the 8-lane highway has been constructed at a cost of around Rs 4,100 crore. It includes two packages of 10.2 km long Delhi-Haryana Border to Basai Rail-over-Bridge (ROB) and 8.7 km long Basai ROB to Kherki Daula. The expressway will also connect Delhi’s Indira Gandhi International Airport to the Gurugram Bypass.
Prices are already pending
In recent years, the region has witnessed a steep increase in housing prices in anticipation of the highway’s completion.
Data shared by real estate consultancy Anarock shows that the average property price in the region increased by 41 percent between 2020 and 2023 – from Rs 5,890 per square foot (psf) in 2020 to almost Rs 8,300 psf in 2023.
The main reason behind the price hike is a multi-fold increase in both residential and commercial demand in the region.
“With the completion of the highway, we are witnessing a promising decline in unsold inventory levels in the Gurugram and Delhi sectors, from a significant 25-30 percent 8-10 years ago to just 7-8 percent now,” Anshuman Magazine said. , Chairman and CEO (India, Southeast Asia, Middle East and Africa) at CBRE.
Data shared by another consultancy firm, JLL India, showed that residential sales in this region were 67 percent higher in 2023 than in 2022.
“These houses were worth a whopping Rs 25,000 crore. Interestingly, 97 percent of these 12,409 units were under construction at the time of sale,” it added.
One of the region’s leading developers, Signature Global, recently launched a luxury project, “DE LUXE-DXP”, in the region. The project has already been fully sold and the company will invest Rs 2,200 crore to deliver it by 2028.
“This new expressway would not only provide better connectivity to the immediate vicinity and locations of SPR, New Gurugram and Sector 37D on the Dwarka Expressway, it would be a catalyst for price appreciation and promises a bright future for the real estate market in the region. said Pradeep Aggarwal, Founder and Chairman of Signature Global (India) Ltd.
Brokers bet on a larger supply
In response to increasing demand, real estate developers are now focusing on increasing supply in the region. Anarock said it expects to have more than 10,515 homes ready for occupancy in the region in the next two years.
According to Ritesh Mehta, senior director and head (North and West) of residential services and developer initiative at JLL India, “About 175 hectares of land across 17 separate deals worth over Rs 3,100 crore has been acquired by real estate developers since 2022. This submarket .”
In addition to these direct purchases, developers have signed joint agreements for more than 30 hectares in this submarket in the past year.
According to industry estimates, there are currently 29,742 homes under construction in the region, including luxury and affordable homes.
“We can expect increased interest from developers in this micro market, which will lead to increased housing supply in the future,” said Ravi Shankar Singh, managing director of residential transaction services at Colliers India.
“We can expect a wave of new launches, including both residential and commercial projects,” said Mohit Jain, managing director at Krisumi Corporation.
JLL India said it expects a growing supply of “high-end housing” in the region in the coming years.
Despite the greater supply, prices and rentals continue to rise
However, despite the increased supply, property prices and rents in the region are expected to continue to rise.
“The real estate market in Gurgaon is poised for a significant revival, and property prices are likely to witness a steady rise, making this an opportune time for those looking to invest in the future of urban living in Gurgaon,” said Pankaj Pal, general manager. at Whiteland Corporation.
Magazine said: “We foresee a notable increase in property and land prices in the area, potentially rising in the coming years, delivering a lucrative return on investment for early investors.”
“With improved infrastructure and connectivity, rental properties in the region are also expected to see a rise in demand,” he added.
First print: March 11, 2024 | 2:07 PM IST