News & Views on Indian Real Estate

Thursday, May 22, 2008

Rising Residential Rentals in Delhi

Rentals of residential properties in central Delhi has appreciated up to 13 per cent in the first quarter of 2008 as demand continues to be buoyant despite the capital witnessing saturation in development of new space. Demand in these locations was driven by expatriates who have the ability to pay higher rentals. Majority of the south Delhi locations registered an increase in the range of 7-11 per cent primarily due to limited scope of development and buoyant demand. Leasing activities were active across all micro-Markets as the end-users had deferred their purchase decisions due to expected corrections in the prices in near future. The capital values of the south Delhi locations had also risen in the range of 10-34 per cent over the quarter mainly due to limited supply and relatively high demand. The suburban locations of Gurgaon and Noida witnessed marginal appreciation of 2 per cent over the quarter. End-users as well as investors have adopted a wait and watch policy in anticipation of correction in apartment prices and home loan interest rates.