News & Views on Indian Real Estate

Thursday, September 11, 2008

Tier III Cities-Next Promising Investment Option

With the property market tumbling in big cities like Bangalore, realtors are now shifting their focus to tier III towns. A total of 47,000 properties were registered in Shimoga during 2007-08 as against 33,000 in 2006-07. In Davangere, the corresponding numbers were 54,000 and 37,000, similarly with Gulbarga, Hassan, Tumkur, Bagalkot, Mandya and other tier-III towns. This is when property transactions have ebbed in Bangalore and Mysore. The tier-III towns have never had it this good with the market prices of land having increased by two to three times. Two years ago, one square feet of land in Vinobanagar in Shimoga used to cost Rs 250 to Rs 300. Now it is around Rs 1,000. In Bellary, a square feet of land in a decent locality now costs Rs 1,200 up from Rs 300 to Rs 400 two years ago, officials said. With such a hike in the prices, boom is likely to shift from cities to these towns.