A Review of The PCMC Property Market in 2016

– Anil Pharande, Chairman – Pharande Spaces
 
As the new year dawns, India’s real estate market has begun navigating the potentially choppy seas of 2017 with a lot of uncertainty. When it comes to the past year, it is safe to say that nothing went as anticipated for the property market. The hoped- for recovery in the residential sector did not happen, and the Government’s unexpected demonetisation move in early November put paid to any chances for a last-minute turnaround.
 
Robust economy: Through the entire gamut of churn and setbacks in 2016, only one city’s real estate market managed to hold its own and even achieve some modest growth. West Pune, with its dominant market PCMC (Pimpri-Chinchwad Municipal Corporation), has always been a unique as it rides on an unbeatable trinity of residential demand drivers – manufacturing, Information Technology and the services sector. This equation has perennially acted like a healthily diversified investment portfolio, with the inherent strength of one or two of these sectors compensating for the occasional de-growth in the others. As always, this factor came to the rescue of the PCMC residential market.
 
Employment still drives housing demand: While the manufacturing sector in PCMC has always been robust thanks to the MIDC belt, continued growth in IT and the various services streams additionally ensured that the employment graph remained strong. With job creation continuing to drive the demand for homes, Pimpri-Chinchwad Municipal Corporation crossed the finish line of 2016 ahead of the other major cities – with room to spare. Though the demand for prime and luxury housing has remained somewhat subdued, budget and mid-income housing saved the day. If anything, 2016 amply illustrated that the middle class in Pune and PCMC has become extremely choosy about its home purchases.
 
Unsold inventory: Many of Pune’s peripheral areas – the hot investment favourites of 2014-15 – saw a depressing build-up of unsold supply even in completed projects. The lack of support infrastructure and known deficiencies such as inadequate or non-existent water supply put paid to many a developer’s hopes of selling his stock solely on the basis of enticingly low rates and freebies.

Of course, every large city in the country has its share of unsold inventory today, either because of muted market sentiment, the fact that a lot of supply is still in the early stages of construction, supply in the wrong locations, or unrealistic pricing of certain projects by developers. In the case of West Pune, most of the non-selling oversupply has been in locations lacking infrastructure. In PCMC, the supply overhang is largely from smaller developers without a good track record and credibility on the market.
 
Evolving buyer preferences: Diwali, the traditional period for increased home purchases in Pune, saw very few takers for inferior projects in inferior locations. Even the prospect of acquiring larger homes than their current ones did not draw mid-income buyers to lagging locations. On the other hand, there was a distinct uptick for smaller but ‘high-performance’ homes in properly connected areas. The accent was on a high degree of facilitation within such projects.
 
Price corrections: With 2016 bringing a slow but steady erosion of property pricing in most of its markets, some of the previously unaffordable locations in West Pune / PCMC have once again become attainable to homebuyers. If Budget 2017-18 brings the hoped-for benefits for first-time property buyers and the RBI rolls out lower interest rates, there is every reason to expect a major revival in home buying sentiment – and it is the superior locations which will see the highest demand.
 
Outlook for 2017
 
The trend of the real estate market in Pune and PCMC performing against the larger odds will definitely continue. Not only do the twin cities have all the right economic and demand drivers firmly in place, but their inclusion in the 100 Smart Cities program will only increase the interest from multinational companies to set up and expand operations here. This will, in turn, increase inward migration and fuel greater demand from investors, even as local end-user demand continues unabated.
 
While the bulk of demand today comes from end-users, investors are still very much a force on Pune’s property market. The city offers several budget bandwidths and property typologies into which one can invest. Well-timed and properly researched real estate purchases can reap very satisfactory returns.
 
However, it should be borne in mind that not every kind of investment pays off equally in Pune – one needs to know precisely how each sub-market works, what it responds to and where the demand is headed. A poorly-judged property investment can be a disappointing proposition. Particularly, investors need to be wary of the cheap, potentially illegal ‘gray market’ residential constructions happening on the outskirts.
 
About The Author:
 
Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in West Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings. Woodsville in Moshi is another highly successful PCMC-based township by Pharande Spaces which is now in its 3rd phase.

PCMC Beats Pune To Rank Among India 10 Cleanest Cities

– Anil Pharande, Chairman – Pharande Spaces

The verdict by Swachh Survekshan 2016, a survey undertaken by the Ministry of Urban Development February 15, 2016 to monitor how far the Union Government’s Swachh Bharat Mission has progressed, was an eye-opener for India. While the multiple award-winning Pimpri-Chinchwad Municipal Corporation ranked 9th on the list of India’s 10 Cleanest Cities, Pune – administered by the Pune Municipal Corporation, did not make it to the Top 10 list at all.

punawale_pharandeAltogether, the Swachh Survekshan 2016 survey studied 73 cities having populations of 10 lakh or above, and focused on aspects such availability of public and private latrines, the efficiency of services delivery, solid waste management and infrastructure development. Always at the forefront when it comes to providing a healthy, wholesome life to its residents, PCMC had in the recent past added to its solid waste processing capabilities via a new garbage depot.

This mechanised plant processes 500 tonnes of garbage into compost useful for agriculture on a daily basis. Moreover, PCMC has set the national trend in its progressive and scientific management of landfills, as well as its initiative to turn waste plastic into energy.

Another variable which the Swachh Survekshan 2016 survey focused on was the effectiveness of communication in the identified cities, specifically their citizens’ access to information and education, and the civic authorities’ proactive approach to in Behaviour Change Communication (BCC). BCC is a very important interactive function via which a city’s governing authorities communicate with the city’s population to ensure that initiatives to help the city to grow and prosper are understood and adopted.

bannerWithout a doubt, PCMC has been consistent in upholding its promises to provide the very best living standards to its residents. Therefore, the fact that it has been numbered in the 10 Cleanest Cities of India comes as no surprise. The Pimpri-Chinchwad Municipal Corporation is a veritable masterpiece of urban planning, driven by an unrelenting focus on infrastructure, sustainability and future-readiness. It offers a sharp contrast to the confused and retrograde approach being followed by the Pune Municipal Corporation, which has not been able to deliver on the functions and aspects that make a city worth living in.

The fact that PCMC has been able to come out a winner on the list of India’s 10 Cleanest Cities is all the more remarkable if we consider that this region is home to the thriving MIDC industrial belt, as well as the Hinjawadi Infotech Park. These hubs are among the country’s most prolific employment generators, causing countless new skilled professionals to make PCMC their home every year.

Despite the immense complexities this presents to the city authorities, PCMC has consistently risen to the challenges and continues to provide people from all walks of life and income segments with a wholesome, healthy environment to live and work in. It has been able to do this is by encouraging the development of integrated townships and ensuring that all real estate development happens with strict compliance to its town planning norms.

In PCMC, open spaces and green ‘lung’ pockets are available in every sector to control pollution and provide citizens with places to meet and relax, and wide roads and over/underpasses allow for free-flowing traffic. Water and electricity supply is several times more reliable than in the Pune Municipal Corporation, and highly efficient civic sanitation services ensure that all residential and commercial zones are kept clean.

Thanks to these factors, there is no doubt that PCMC will move further up the rankings over the next few years. In the meantime, it will continue to focus on maintaining its well-deserved reputation for being the best region in the country for people to work, live and prosper in.

About The Author:

Anil PharandeAnil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings. Woodsville in Moshi is another highly successful PCMC-based township by Pharande Spaces which is now in its 3rd phase.

Why Roads Boost Real Estate Growth

Anil-Pharande– Anil Pharande, Chairman – Pharande Spaces

It is no secret that improved road connectivity is very important for real estate growth. Most property brokers will make a big case out of an area’s excellent road network and how this improves the appreciation value of a proposed property. But how exactly does this phenomenon work? What is the real ‘connection’ between better roads and better real estate values?

  • The History Of ‘Road Power’

Infrastructure is the key to growth for real estate – and the cornerstone of infrastructure is roads. The importance of roads to human being is vouchsafed by how long they have been around. The oldest paved road in recorded history was made sometime between 2600-2200 BC in Egypt; but it was the Roman Empire which brought out the fullest potential of roads traversable by wheeled, horse-powered carriages.

Pic 7

Circa 312 BC, the Roman Empire built stone roads throughout Europe and North Africa to aid its military campaigns. At the height of their power, the Romans had built 78,000 kilometers of roads that led to and from Rome. History is witness to what the Roman Empire achieved by connecting the parts of the world that were important to them to their seat of power.

However, it was only much later that ‘road power’ could begin to be fully exploited. It was, in fact, only in 1768 that the French inventor Nicolas-Joseph Cugnot built the first steam-powered automobile capable of human transportation. Ever since then, roads have emerged as the master key that unlocks all urban potential in the modern world.

  • Fast Forward To Today

It is safe to say that real estate development as we know it is impossible without adequate road networks. In the first place, they are required to transport construction materials and manpower to sites. Thereafter, people need roads to be able to travel to the newly developed locations. However, the basic roads that are initially used to ‘open up’ and area usually fall short of the task of really making it prosper. High volumes of traffic require larger, better-planned roads to accommodate it, and it often emerges that existing distances between locations can be significantly reduced by laying new roads altogether.

In the city of Pune, one recent example of the introduction of a new major road can cut down the distance that needs to be travelled between destinations was the Spine Road in the Pimpri-Chinchwad Municipal Corporation (PCMC). The launch of this important piece of infrastructure had a direct and very beneficial effect on residents in all the areas it influences. It connects two major highways, provides access focus for various residential, commercial and industrial centres and is the longest stand-alone road in the region. Spine Road has significantly relieved traffic congestion on internal roads – it has six lanes with cycle tracks, service roads and even parking facilities.

  • How Roads Improve Urban Life

Time Saved = Improved Lifestyle: With the shorter distances achieved by well-planned and strategically laid new roads, people can choose to not use their fuel-guzzling cars and travel to and from work by public transport or two wheelers instead. Apart from improving the quality of lives, this also decreases noise and air pollution in residential areas. Improved road connectivity also improves the overall safety of a neighbourhood, because emergency services like law enforcement and fire brigades can reach there faster. Residents also have quicker access to hospitals, which often makes the difference between life and death.

Obviously, infrastructure initiatives like the Spine Road in PCMC are a major advantage to employees working in the area’s numerous manufacturing and service industries. In Indian cities, the amount of time it takes to get to and from one’s workplace literally makes or breaks residential locations. Also, because residents of well-connected localities can reach and return from their workplaces faster, they have more time to spend with their families. The same fundamental works for school-going children, as well.

Considerable Savings On FuelEver-increasing fuel prices were once a concern only to the middle class, but they are today even the more affluent classes are feeling the heat. In India, electric cars that can meet the travel requirements of a normal-sized family are still a distant dream. Like it or not, we continue to depend on fossil fuel-driven vehicles.

A normal middle class family can save quite a lot on its monthly fuel expenses when a new road improves overall connectivity in their locality. Communities which live in areas without good road connectivity often spend between 10-15% of their monthly income on transportation alone. The figure rises proportionately to the number of vehicles the family operates.

The Health ‘Connection’Reduced travel time also equals a lower chance of commuting-related physical ailments and stress levels. When people have to travel over longer distances daily, the time in which they are exposed to traffic pollution and extreme climate increases proportionately. Several serious health problems such as deep vein thrombosis and lung infections have been directly linked to regular, long automobile travel.

By the same coin, road rage and reckless driving also often the direct by-product of traffic congestion caused by insufficient road linkages. Also, improved road connectivity leading to significantly shorter travel distances makes it possible for people to opt for health-positive travel modes such as bicycles.

The Real Estate ‘Connection’For all the above reasons, improved road connectivity has a massive impact on real estate prices of a location. There is always higher demand for homes in well-connected areas, because they are more accessible, safer, healthier and cheaper to live in.

About The Author:

Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings.