The Chennai residential market has witnessed a strong upward movement in terms of capital values over the previous year with many micro markets crossing the peak levels of 2008.
According to Cushman & Wakefield, the highest capital appreciation in Chennai was witnessed in Adyar and Poes Garden both recording 25 per cent growth in capital values over last year. The demand for residential units in Chennai is likely to grow at a CAGR of 11 per cent between 2011 and 2015.
The infusion of supply over the next five years is expected to be around 117,500, which is higher compared with certain other major cities such as Bangalore, Hyderabad and Pune.
Property prices across most locations is likely to remain stable during the next few quarters.
Chennai witnessed nearly 100 new residential project launches during 2011 and approximately 15,000 units will be available in the city in the next 2-4 years. The supply during the year was mainly concentrated towards the mid segment and peripheral markets.
Kalpana Murthy, associate director – Residential Services, Cushman & Wakefield India, said the Chennai market had been steady and would remain stable over short to mid-term purely on account of positive demand trend. All segments and locations within the main city of Chennai were experiencing growth, with the mid segment registering the highest. The Chennai market is primarily self-sustained, thereby, even as the global markets seem to go through some upheavals (not to be confused with economic slowdown) Chennai’s reaction to these changes may be limited.
A substantial part of the total supply entering the market in 2011 was located in the growth corridors of Chennai. The more vibrant growth corridor locations of Perungudi, Thoraipakkam, Sholinganallur, Perungalathur saw the launch of 750 units. New upcoming locations of Kelambakkam, Beyond Vandalur, Oragadam and NH -4 recorded approximately 6,400 units largely catering to the investor segment.
However, most of these locations will be long-term investment options only.
