Just what‚Äôs going on in this new patch of land? Why have prices suddenly shot up here? Is it a mirror of what happened to Gurgaon, Noida, Greater Noida and Ghaziabad in the past two to three years? Or is there real value here?
One big reason why Kundli is emerging as a ‚Äėhot‚Äô real estate destination is that most other areas around Delhi have already been developed, and prices there are up. Says Abdul Bari, VP, Majestic Properties: ‚ÄúFor investors, Kundli offers maximum scope for price appreciation since prices are low here, while they are already quite high in most other parts around Delhi (See table: Kundli vs rest). Its future has brightened after it was declared part of the NCR in Delhi‚Äôs Masterplan 2021.‚ÄĚ
A number of developers - who have established reputations in Gurgaon and Noida - have purchased land banks here. These include TDI, Ansal Properties & Infrastructure, Parsvnath, Omaxe and Senior Builders. Of these, TDI and Ansal have got licences from the government, while the rest have applied.
Right now, there are three kinds of property available in Kundli. One, a pre-launch offer that allows investors to get into a project before it has been officially sanctioned. This comes with appreciation advantages and project risk (See To book or not to book, Express Estates, September 3, 2005) and is usually sold by brokers. Two, a property that has the sanction of the municipal authority and is sold by the builders. Three, second sale properties sold through brokers.
Pre-launch sale: If you buy property from a developer who has not yet got his licence, that‚Äôs a pre-launch sale. The advantage of such an investment is that prices are quite low at the pre-launch stage. But the risk is that the builder may not get the license to build. In which case, your investment will not see the kind of appreciation you expect - you might even end up losing your investment. Therefore, a pre-launch purchase is a high-risk, high-return investment. If you are making such aninvestment, stick to well-known builders.
Prospects for appreciation: Prices have appreciated by 45-75 per cent in the last six months to one year. If you are a short-term investor, ask yourself whether such appreciation will be repeated over the next six months or one year.
Purchase price: The price at which you buy the property will matter. In some parts of Kundli, property rates have touched Rs 11,000 per sq yd. The likelihood of such properties seeing another 100 per cent appreciation over the next six months to one year is low. As Pintu Yadav, broker from Surendra Properties in Kundli says, ‚ÄúIn such properties, whatever profits had to be made have already been made by the person selling to you.‚ÄĚ
If you plan to buy a property in order to live in Kundli, you should check out the long-term prospects of the area - issues like connectivity, employment avenues, and infrastructure projects planned here.
Kundli‚Äôs is easily accessible, being located right on the highway. It is 25 km from the Pitampura TV Tower. Two new infrastructure projects have also been announced, which should provide a kicker to those wanting to live here:
l According to Rajesh Katyal, Sr VP at Ansal Properties & Infrastructure: ‚ÄúA new expressway will connect Kundli to NH-8. It will have two corridors - the eastern corridor that will go via Ghaziabad and Noida, and a western corridor that will go via Bahadurgarh.‚ÄĚ
l The metro rail will touch nearby Narela by 2007 and will reduce travel time significantly across the board.
As for employment avenues, Rai Industrial Area is under development in Sector 7, Kundli. A container depot will soon be set up. Several rubber and belt manufacturing companies have set up base here. HSIDC is promoting Sonipat district as one of Haryana‚Äôs largest industrial belts. Bawana and Narela, two other industrial areas are located nearby. The Haryana government is planning an Education City over 1,500 acres in Kundli.
Gurgaon‚Äôs growth was driven by the fact that a large number of MNCs and corporates shifted base from CP to Gurgaon in the late 1990s. The ITES boom provided further fillip to Gurgaon‚Äôs growth. Areas in and around Gurgaon have a large number of industries. Noida, too, has a large number of software and ITES companies and export houses. What are the growth drivers in Kundli?
Says Pradeep Jain, chairman, Parsvnath Developers, who has applied to develop 700 acres in Kundli: ‚ÄúMNCs and corporates will come once the facilities are available. Kundli today is at the stage where Gurgaon was in the late 1980s and early 1990s.‚ÄĚ
Adds Ansal‚Äôs Rajesh Katyal, who has a license to develop 400 acres here: ‚ÄúIn the development of any suburb, investors come in first. End-users come in only once the houses are built, and the social infrastructure is ready.‚ÄĚ
Ravindra Taneja, MD, Taneja Developers, who is developing a 600-acre mini-city in Kundli says, ‚ÄúThe townships being developed by private developers will develop all the social infrastructure.‚ÄĚ
All signals point to Kundli emerging as ‚Äėhot property‚Äô. But much of that lies in a future which is a bit blurred right now. At present, it is a market more for those who have the cash to spare, and an appetite for risk. Those who have only a small saving and want to invest in a house that they intend to live in should invest only in projects that have got the licence from the government. You are also safe if you invest in projects that have been pre-approved by banks and housing finance companies for loans, since the latter tend to do a thorough due diligence of projects. Otherwise you would do well to wait till Kundli‚Äôs growth pattern becomes clearer.