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      Mumbai, Pune and Bangalore- Top cities to invest in Indian Real Estate

      • 5 min read
      • Last Modified Date: February 2, 2023
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      The pandemic has affected the real estate sector largely. Even though work from home became a new trend and housing became a necessity, several investors held back from investing due to the uncertainty that the pandemic brought in. However, the reports of a leading real estate platform indicate that the markets in cities such as Mumbai, Pune, and Bangalore are recovering at a faster pace. The recent ease of living index published by the Ministry of Housing and Urban Affairs provided termed Bangalore and Pune to be the topmost cities to live in. 

      One of the main reasons for this boom may be because of the return of end-users and investors to the market after the pandemic. The IT or the ITeS sectors have been determined as the prominent factor contributing to the recovery of the real estate market in Mumbai, Pune, and Bangalore. Some reports also provide that these markets remained active in 2020 amidst the challenges brought in. Mumbai, Pune, and Bangalore together recorded sales of 67% of the total housing sales in the top 7 real estate markets in India. Let’s check further why each of these cities has been the top spots of attraction for realty investors. 

      Bangalore Realty Market

      The Bangalore realty market has been one of the prominent markets in India as it is the IT hub and invites several start-up investments. The rapid urbanization and the quality infrastructure provided by the city are some of the key factors that have contributed to the demand for real estate properties in Bangalore

      As already mentioned, Bangalore has been recognized as one of the most livable cities in India. The realty sales in 2020-2021 recorded a total supply of 33% in the mid-segment while 30% has been recorded in the ultra-luxurious segment, 20% in luxurious, and 17% in the affordable housing segment. Several investors have also started to prefer 2.5BHK or 3.5 BHK homes as they are currently looking for spaces that can be converted into a home office or storage space. This model has been incorporated in the on-going under-construction projects. The current reduction in the stamp duty taxes in the recent budget is expected to boost the realty market further. 

      Pune Realty Market

      Pune has been recognized as one of the most top livable cities along with Bangalore. The first half of 2020 saw a dip in the real estate sector due to the pandemic. However, the second half showed a rapid recovery due to certain factors and this is expected to boost and restore the market in 2021. 

      The major factor contributing to the rapid growth of the real estate market in Pune is the initiative taken by the Maharashtra government by reducing the stamp duty imposed on the property. This has been recorded as one of the key reasons for the increasing sale in Pune as the second half of 2020 accounted for a sale of 58%. The tax was reduced to 2% until the end of December while the revised charge from January 2021 stood at 4% which was successful in evoking consumer sentiments as it was a very significant tax saving option. In addition to this, the first quarter of 2021 is witnessing an increase in the sales volume as people are trying to purchase homes to avail the benefits of Long-Term Capital Gains Tax (LTCG Tax) provided under Section 54 of the Income Tax Act, 1961. The combination of the negotiable price range, affordability, and low-interest rates have boosted the residential market in Pune. 

      Technology integration via virtual home tours, video conferencing with prospect clients, targeted digital campaigns, and webinars are some of the other technological factors that contributed towards the rise in property demand in Pune. The metro rails in Pune are expected to boost the realty market further in 2021 as it will provide better connectivity to the investors. 

      Mumbai Realty Market

      Over the past few years, Mumbai has been treated as one of the main centers for real estate investment despite the skyrocketing prices. The main reason for this is that it is the financial capital and has the strongest economic growth in all of India. The Mumbai Metropolitan region has been recognized as one of the major attractions by investors as it is one of the major contributors to India’s overall GDP.   

      The residential market of the Mumbai Metropolitan region hereby referred to as MMR, showed launching and sales activities in 2020 despite the pandemic. MMR also recorded a decline in the number of unsold inventories by 6% which was also better than the previous years as the decline in unsold inventories and year-on-year stood at 3% in the past 7 years. 

      Factors such as the multiple metro links, Mumbai Trans Harbour Link, etc. have further attracted investors to invest in Mumbai. The builders and developers are also attracting buyers to invest as they are offering great discounts on the properties. The discounts coupled with the stamp duty reduction granted by the Maharashtra government have efficiently evoked consumer sentiment. 

      Bottom Line

      Several investors have recognized real estate as one of the best options for long-term financial investment. Investing in real estate has been considered to be a better option as it provides high capital appreciation and also a stable income if you are investing in rental properties. The pandemic has affected the realty market in India. However, the steps taken by some of the builders and government in cities such as Bangalore, Pune, and Mumbai have been remarkable as the market saw a slight increase in the sales rate towards the end of 2020 and the first quarter of 2021. 

      Assetmonk is an online platform offering investment opportunities in cities such as Bangalore, Chennai, and Hyderabad. Assetmonk offers projects on both long-term and short-term basis. The properties are listed by us after conducting a proper inspection and due diligence process. Visit our website to know our offerings!

      Frequently Asked Questions:

      Yes, it is the right time to invest in India as the real estate market is booming in India. Affordable housing units and mid-house segments have been the top attractions for real estate investments. The demand for luxurious properties has also been in high demand despite the pandemic due to the discounts granted by builders and developers.

      Some of the best cities to invest in in India include Bangalore, Hyderabad, Mumbai, Chennai, Pune, etc. the recent reports have shown Bangalore and Pune to be the best locations for residential investments. Chennai, Mumbai, Bangalore, etc. are the top locations for commercial investments due to the presence of large companies. 

      Bangalore is termed as the IT capital of the country and it is a city that attracts large IT companies. The Bangalore realty market is driven by the IT professionals that are looking forward to settling in Bangalore due to its rapid urbanization, better infrastructure, connectivity, modernized lifestyle, and access to facilities such as education and health. Thus, it is the best time to invest in Bangalore.

      Mumbai, the commercial capital of India is a city in which the realty sector was active despite the pandemic. An investment in Mumbai is a great option at present as the government has reduced the stamp duty charges and has also introduced several projects to improve the connectivity and infrastructure of the projects. By investing now, you can get the best property at the best price.

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