Karnal offers good ROI options
An improving secondary market, a variety of housing options available and subdued property prices have opened up prospects for the Karnal realty market
Located on national highway (NH-1) between Chandigarh and Delhi, the Karnal housing market has traditionally attracted buyers, particularly investors, from across the region for its potential to deliver attractive investment returns. Though growth has been slow in the local market, its long-term potential to offer high returns on investment is still strong, say local real estate experts. Between 2007 and 2011, the growth rate of Karnal’s market had been fastest in terms of price appreciation, supply and demand. In the last couple of years, price appreciation has declined and supply growth has stabilised. Demand is driven by local end-users.
For a buyer exploring the local realty market, one big advantage is the number of options available in terms of realty players, housing segments, price entry points, and infrastructure quality.
Multiple players: Unlike other tier-III cities in the state like Ambala and Panipat, located between Chandigarh and Delhi on the GT Road (Grand Trunk Road or NH-1), which have very limited number of developers, Karnal has multiple local and national-level realty players. The public sector Haryana Urban Development Authority (HUDA) is the key player in the city, responsible for development of the largest chunk of land in the city which has several HUDA sectors. The most expensive residential property in the city is located in the improvement trust developed areas. Private sector developers such as the Alpha G Corp, Ansal Housing, Ansal API, Parsvnath, Global Realty, CHD and others also have sizeable footprint in the local realty market. These players are offering commercial and residential spaces in more than 1,000 acres across the city, though, primarily around the NH-1. “Realty buyers looking for attractive investment options should focus on the housing coming up around NH-1. NH-1 is the major centre of realty activity, with most of the primary and secondary market supply concentrated on either side. The city has expanded from the old city around the GT Road to the HUDA sectors and private developer led projects. Six-laning of the highway is almost complete except for some over-bridges and underpasses.
Prospects of the secondary market have been improving in the last few years as developers have been delivering apartments and families have been moving in. The primary market, though, has weakened with very low supply,” says Vikas Sangawan, a local real estate consultant.
Price points: In the private sector, developed areas like Alpha International City, Ansal Town, the general price range has declined from R15,000 per sq yard- R20,000 per sq yard to R9,000 per sq yard- R15,000 per sq yard in the last couple of years. “After corrections of the last two years, prices have now stabilised. We can expect a marginal decline in prices but not a repeat of the price corrections of the last two years,” says RL Sharma, a local real estate consultant. Generally, the price range varies from R6,000 per sq yard (on the outskirts) to R 60,000 per sq yard (in the older developed areas).
Supply variety: Most of the supply is located in the freehold plot segment, with HUDA sectors and improvement trusts developed areas only have plotted development. In addition to plots, built-up kothis (bungalows) are also available, but in the resale market and from individual sellers. The apartment market in the city grew after the entry of national-level developers. Buyers can choose from 1-BHK (bedroom-hallkitchen) apartments to 4-BHK penthouses, though most of the supply is in the 3-BHK apartment category. Also available are built-up houses in the 2-BHK to 4-BHK villas categories. Average sizes vary between 380 sq ft to 4,500 sq ft.
“It is an excellent opportunity for an investor with a long-term perspective. An investor who is keen to exit quickly should not enter now. The supply and demand dynamics, and the general economic conditions don’t favour a quick market turnaround. However, if one has patience and spare funds then entering now can deliver excellent returns in the long term. The greatest advantage for the city is its location. Now, the chief minister of the state is also from the local assembly constituency,” says Sanjeev Gautam, a local resident and realty expert.