2012 saw real estate prices soar and little known areas became hot spots on the realty map. Exorbitant rates were quoted for lesser known localities and there was sudden mushrooming of flats, gated communities and villas along with several unknown builders surfacing. People with vacant lands entered into joint development with builders and with the profits bought more lands and developed them, thus creating a lucrative businesses.
2013 saw a slowdown to this maddening rush. Property prices and number of flats that were constantly on increase saw a halt through the year. During 2013, 3.5 million square feet of real estate was built and 13,000 units were launched in the city and this is a 15 per cent decrease compared to 2012. The residential sales volume dropped by 33 per cent while office space sales declined by 23 per cent, states a report from Knight Frank, a residential and commercial property consultancy. The current slowdown is attributed to a decline in economic growth, rising interest rates and high inflation.
Cushman and Wakefield, a commercial real estate services firm, estimates that 2014 will see 16,000 completed apartments which will form a cushion for completed houses during the year and will help to pick up demand. The firm also states revival in the high-end properties market like Nungambakkam, Kotturpuram, RA Puram, Poes Garden and Mylapore. The commercial space scenario for 2014 expects an addition of 2.2 million square feet in the suburban parts of the city of which about 1 million square feet is expected to be utilised by IT and ITeS sector,
5 lakh square feet of commercial spaces and the remainder in special economic zones for IT and ITeS.