Unlike the high-value real estate markets of Bengaluru, Gurgaon, Mumbai, and Hyderabad, the property graph in Kolkata has always remained consistent, with a steady demand for residential apartments in Kolkata. After a long spell of economic turmoil, Kolkata has revealed its limit of market tolerance, which has rendered it impact resistant. Categorised as a slow-moving market, it has emerged as a key secondary investment option now.
Real estate markets in the other densely populated cities like Bengaluru, Mumbai, Gurgaon, and Hyderabad deliver a fast-paced growth. Kolkata has always shown a steady graph to attract big players seeking stability in times of economic slowdown. All the big cities failed to maintain their trajectory of growth but Kolkata has clocked double-digit growth, surpassing Gurgaon and Mumbai in terms of growth achieved in the last decade.
Residential apartments in Kolkata
Kolkata ranks among the most livable cities in India, and the rate per square foot to buy residential apartments in Kolkata makes it a buyer’s market. Despite holding one of the largest unsold inventories due to the pandemic, the Kolkata market follows Bengaluru and Pune in terms of an increase in market size. Most of the retail investors are seeking real-estate in low-inflated states like Kolkata. With micro-locations like New Town and Joka showing robust growth in terms of new launches of mid-segment residential properties in Kolkata due to its proximity to the IT job sectors in the area, the real estate market in Kolkata presents significant potential in the coming years. The city’s growing job market trend projects a higher demand for residential apartments in Kolkata, and this translates into a promising scenario for investments to generate rental income.
Kolkata missed the benefits of the earlier wave of the IT revolution. This time, Kolkata is poised to win big as the leading IT giants have already chosen to invest here in a major way. The start-up revolution has also led to a significant surge in the local job market. Government-sponsored projects like the SEZ in New Town and private projects like Infosys IT Hub have revived the economy. Infrastructure development projects like East-West Metro have further added to the goodwill of the city as a progressive state. Big global brands have entered the consumer sector now. While other metro cities appear almost saturated, residential apartments in Kolkata present a good potential of capital appreciation for investors and end-users.
Incentives to invest
Residential apartments in Kolkata deliver affordable housing options to all. The banks have lowered interest rates for home loans. There are tax-saving incentives to encourage investment in real estate. Such factors have played a positive role in boosting up demand for residential properties in Kolkata. HIRA (Housing Industry Regulation Act), West Bengal has dramatically improved transparency in the Kolkata property market and home buyers have enhanced confidence to buy residential properties in Kolkata now.
Driven by local demand for affordable housing, several developers are launching projects to cater to the mass market segment. Affordable property options along with the cheaper cost of living have made Kolkata a perfect choice for homebuyers.
Traditionally identified as a user-driven market, Kolkata is fast emerging as a real estate hotspot. Compared to other cities, it remains one of the most affordable markets in the country in the residential segment. As the developers are absorbing the increased cost to perk up sales, it is a good time to invest here in property now. Localities witnessing a spike in demand include Rajarhat, Patuli, New Town, Garia, EM Bypass, Dum Dum, and Sonarpur. Suburban areas such as Uttarpara, Behala, and Barasat are also seen as preferred destinations to buy homes.
Individuals can avail of the benefit of the capital gains rollover once in a lifetime. The decision provides middle-class taxpayers a reason to rejoice and spreads cheer in the real estate industry. Owing to children’s education, job needs, or accommodating parents, maintaining two properties is common these days. The exemption of income tax on notional rent on second self-occupied properties has encouraged home buyers to have a second home. With GST capped at 1 percent for affordable housing, and at 5 percent for regular units, the revision is meant to bolster demand for under-construction projects and new projects in the affordable housing category.
Steep price cuts in the property prices seem unlikely to happen in Kolkata. Real estate prices in the city have already undergone the required price correction. The community of developers now operates on wafer-thin margins. High-end residential properties in Kolkata is the only category where some price correction due to the accumulation of inventory is expected to happen.
The sudden jolt on account of delayed construction at the new project sites has made real estate developers keen on selling their properties. Prices have continued to remain stable over the past few years. Lucrative EMI and moratorium offer further benefits home buyers. As the government is eager to provide the big push through solid support to real estate and infrastructure players, the situation also turns out to be advantageous for home buyers who pay less for bigger residential apartments in Kolkata.
Kolkata’s economy shows signs of recovery from the pandemic and the real estate market in the city emerges as the perfect option to invest in property. When other investment options do not look promising, investing in a home in Kolkata appears to be the wisest thing to do. As global companies show interest in shifting their operational base from China to India, these firms are set to become major job providers and generate the need for space to accommodate their workforce where they set up their units. Given the series of merits, Kolkata emerges as their preferred choice. This gives home buyers another concrete reason to realise this is the right time to invest in the real estate market in Kolkata.