Rain hits real estate market in city

Rain hits real estate market in city

The Hindu

Land prices in areas that had been severely affected have taken a beating

# In HSR Layout area, land prices have fallen by almost Rs. 1,000 per sq ft.
# The poor infrastructure resulted in the collapse of many deals

Bangalore: Last month's record rainfall did more than flood and wash away roads. Its aftermath has seriously affected the real estate market, according to realtors.

For over two years, the southeastern periphery of the city was being developed with several apartment complexes and villa-type constructions. In the Hennur-Sarjapur Road (HSR) Layout area, land prices soared to touch Rs. 4,500 per sq ft. Prices have already fallen by almost Rs. 1,000 according to real estate dealers.

The area was getting fast promoted due to its proximity to already well-developed areas such as Jayanagar, J.P. Nagar and Bannerghatta Road. For the staff of the many IT firms that have come up along Bannerghatta Road, it was a convenient drive away. For the wealthy, it was an area where they could buy large plots and build individual bungalows that had become difficult in the more developed areas.

"None of them anticipated the kind of flooding that took place in October, practically cutting off the area from the rest of the city for days together. The roads have also been left in a pathetic shape. Many deals have failed to come through because potential property buyers have second thoughts," says a realtor who did not want to be named. Several parts of Bannerghatta Road repaired earlier had also been washed away and there might be few takers for the vacant flats in the apartment buildings on those stretches, he said.

Several layouts coming under the Bommanahalli CMC have also become victims of the vagaries of the real estate market. The heavy rain exposed the lack of infrastructure, especially drainage, here and in other CMC areas which were affected. The fact also came to light that many layouts had been developed, perhaps unauthorisedly, on what used to be tank-beds or bunds. Others were on natural drainage channels which in an earlier time were rivulets. Some BDA approved layouts were not spared either.

Parts of BDA's own layouts such as Visvesvaraya Layout, Vrishabhavathinagar (also called Banashankari 6th Stage) and Anajanapura Layout suffered from the heavy rain, though to a lesser extent. Inadequate approach roads and streets, which were submerged, were among the problems the residents faced.

Homebuyers might now be wary of such layouts and private developments in the vicinity, realtors said.

All these factors were expected to benefit developers in other areas where the severity of the rain fallout was much less. These include the northwestern periphery of the city and some of the older neighbourhoods where dearth of supply had already created a seller's market, those in the trade said. The long-term outlook may well depend on whether the Government goes ahead with its proposal to amalgamate all the CMCs into the Bangalore Mahanagara Palike.