Infra growth pushes up property values in Baner, Balewadi in Pune Pune has been witnessing overall growth in infrastructure in recent years with areas particularly in the east of the city. The proximity of the area to IT hubs has contributed considerably to the infrastructure development seen here. Some of the areas in North-west Pune which have witnessed rapid development in social infrastructure are Baner andBalewadi. There has been an increase in the number of educational institutions, IT companies and retail outlets in these areas. Due to the large-scale infrastructure development in these areas, the rental rates there have increased considerably in the last few quarters. Strategic location While Baner is located about 10 km from the city center, Balewadi is about 17 km from central Pune along the Wakad Road on the city’s north-western fringe. The two areas are located about 10 km apart and is connected through theMumbai-Pune Bypass Road. Located towards the outskirts of the city, they were relatively affordable areas until a few years back. However, since the last two years, these areas have seen growth in both capital and rental values. Capital and rental values surge The rental values in these areas has recorded a growth between 20-30 per cent in the last couple of years, facilitated primarily by the infrastructure development that these areas have witnessed. While rental values are an indicator to the demand for property as well as the number of end users in these areas, the market has also been conducive to investors. Capital values in these areas have also frog-leaped by between 25-30 per cent in the last one and half years. As per Commonfloor data, Baner recorded an increase by about Rs 1,250 from Rs 6,151 per sq.ft. in the beginning of 2013 to Rs 7,350 at the end of Q2, 2014 and Balewadi by about Rs 725, from Rs 5587 to Rs 6311 in the same period. Capital values in Baner have appreciated by about 10 per cent (from Rs 6846 to Rs 7350) in the last quarter alone while that in Balewadi is a tad lower. Infrastructure developments The growth in infrastructure in these two areas was facilitated due to the extension in the limit of the city. As a result areas like Baner and Balewadi which were formerly villages came within the purview of the city due to major expressways and highways passing through them. Gradually, these areas started growing due to the establishment of various industries,
particularly the IT industry. Due to the increased manpower requirements that these industries warranted, the need for more housing became a necessity. As a result, there was a requirement for added infrastructure facilities, due to which these areas got a face-lift in terms of more educational institutions, shopping centers and entertainment facilities, among others. Sources of rental demand The primary source of rental demand as well as home buyers in Baner and Balewadi are the presence of IT hubs in areas in the vicinity like Hinjewadi and Aundh. Besides, many companies have set base in Baner and Balewadi as well. These areas are currently undergoing a transformation in terms of the development of various educational institutions and malls. Moreover, the presence of the Pune University at about 5 km from Baner is also a major source of demand for residential accommodation. The availability of residential property at affordable rates was also a major reason for the increase in demand. Compared to other upmarket areas in the vicinity like Aundh and Hinjewadi, capital and rental values in Baner and Balewadi are considerably lower. While rental values for a standard 1000 sq. ft. apartment in other upmarket areas in the vicinity range between Rs 17,000 – 20,000 per month, rentals in Baner and Balewadi range between Rs 12,000 – 15,000. Future Prospects At the rate at which capital and rental values are rising in Baner and Balewadi, the day is not too far off when it would be comparable with other upmarket areas in the vicinity like Aundh and Hinjewadi. The growth of infrastructure in these areas has been a major factor for propelling the capital and rental values. With the further growth in infrastructure facilities, the prices here are expected to increase even further. Hence, this is the opportune time for investors to invest in residential property here before prices spiral beyond their budgetary limits. Source: CommonFloor.com For Latest Updates on Real Estate Updates, Property News and Cities Infrastructure Developments Visit: http://www.commonfloor.com/guide
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