Ren­tals on a sta­ble curve in Lud­hi­ana

Hindustan Times (Chandigarh) - Estates - - HT ESTATES - ht­es­tates@hin­dus­tan­times.com

Lo­cal sup­ply and de­mand dy­nam­ics are the de­ter­mi­nants for the growth pat­terns in the com­mer­cial and res­i­den­tial ren­tals in the Lud­hi­ana real es­tate sec­tor.

The de­mand re­mained stag­nant in the com­mer­cial seg­ment lead­ing to stag­na­tion in the com­mer­cial ren­tals in most lo­ca­tions. In the res­i­den­tial seg­ment, de­mand con­sis­tently in­creased for rental ac­com­mo­da­tion push­ing up ren­tals. “The ren­tals de­pend­ing upon the seg­ment have moved in dif­fer­ent direc­tions. The lo­ca­tion of the prop­erty im­pacts the rental growth, gen­er­ally, the in­ner de­vel­oped parts of the city record higher growth than the pe­riph­ery in terms of rental move­ments,” said Deepak Badyal, pres­i­dent, Lud­hi­ana re­al­tors’ as­so­ci­a­tion.

The com­mer­cial ren­tals vary de­pend­ing up on the lo­ca­tion. In most ar­eas sup­ply has in­creased. While at some lo­ca­tions, the in­creased de­mand from re­tail out­lets, hos­pi­tal­ity in­dus­try and fi­nan­cial sec­tor has helped ab­sorb this in­creased sup­ply, but in other ar­eas the va­cancy rates have in­creased in the last cou­ple of years. “On Mal­har road, open­ing up of restau­rants have helped in sta­bil­is­ing ren­tals. Sim­i­larly, in the Feroze Gandhi mar­ket, busi­ness have helped keep ren­tals mov­ing in the up­ward di­rec­tion or sta­ble. Ed­u­ca­tional in­sti­tu­tions com­ing up in Model Town ex­ten­sion has helped keep the com­mer­cial ren­tals up in this area. As the or­gan­ised com­mer­cial mar­ket is very less in the city so the rental also vary widely,” said Badyal.

The com­mer­cial ren­tals de­pend­ing up on the lo­ca­tion vary widely from ₹30 per sq ft in the pe­riph­ery to ₹150 per sq ft in the in­ner de­vel­oped ar­eas The ren­tals are hov­er­ing be­tween ₹30 per sq ft and ₹150 per sq ft for the last cou­ple of years. Most land­lords are try­ing to re­tain the older ten­ants and so, the in­crease in the ren­tals is only the an­nual ne­go­ti­ated in­crease.

The res­i­den­tial seg­ment, how­ever presents a com­pletely dif­fer­ent sce­nario in the in­dus­trial and com­mer­cial cap­i­tal of the state. “The res­i­den­tial rental, though vary­ing widely, have con­sis­tently in­creased in all the ar­eas of the city, whether pe­riph­ery or in­ner de­vel­oped ar­eas. The slow down dragged down the de­mand for buy­ing new houses but has helped in­crease the de­mand for rental res­i­den­tial ac­com­mo­da­tion. There is also scarcity in sup­ply in each rental seg­ment. This has also pushed ren­tals up,” said, PS Sethi, a lo­cal real es­tate con­sul­tant.

“The monthly ren­tals for a 3-BHK ground floor house in­creased from ₹15,000 – ₹25,000 in the in­ner ar­eas to ₹25,000 – ₹50 000 in the last four-five years Sarabha Na­gar, Ra­jguru Na­gar, BRS Na­gar, Gur­dev Na­garthe rental for 3-BHK is around ₹30,000 per month to ₹50,000 per month. For an in­de­pen­dent kothi the rental may vary be­tween ₹40,000 to ₹75,000 per month,” said Badyal.

The pe­riph­ery is the mid­dle in­come group des­ti­na­tion for rental hous­ing. In the new up­com­ing ar­eas, rent for a 3-BHK varies be­tween ₹15,000 per month to ₹20,000 per month. In the still out ar­eas, the monthly rental for 3-BHK can drop to ₹12, 000 to ₹20,000.

The rental growth is adding value to attraction of res­i­den­tial prop­erty for in­vest­ment. “In the com­ing months, with the eco­nomic out­look chang­ing we might see in­vestors en­ter­ing the res­i­den­tial seg­ment to ex­plore the prospects of earn­ing in­vest­ment re­turns in the form of rental in­comes. This might re­vive the cap­i­tal val­ues of res­i­den­tial prop­er­ties in the city,” said Sethi

IS­TOCK

While the res­i­den­tial ren­tals con­sis­tently, the com­mer­cial ren­tals in Lud­hi­ana are stag­nant for the last cou­ple of years

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