Currently, Chennai’s real estate market is witnessing an interesting trend. Demand for 1BHK units, whether it is for sale or rent, is high in comparison to its supply across the city, according to PropIndex (Oct-Dec 2014), an India Apartment Index report published quarterly by Magicbricks. This situation of low supply against high demand for 1BHK properties can be beneficial for investors with a limited budget looking to earn profit.
According to Magicbricks data, capital values of 1BHK units in the city start at Rs 9 lakh while the rental values begin at Rs 3,000 per month. Areas with high supply of 1BHK units for sale include Kolathur, Korattur, Perambur, Thirunindravur, Medavakkam, Pallikarnai, Tambaram West, Urapakkam, Kundrathur and Porur.
Check out prices of 1BHK units in Chennai!
Prices of 1BHK units in Medavakkam range from Rs 20-45 lakh, with covered area varying from 500-1200 sq ft. Similar units when put on rent can earn you monthly income of Rs 5,000-12,000. The area falls close to IT companies situated along the OMR and Shollinganalur, hence the rental demand generated here is by the IT professionals. “Most of these people are from outside the city, hence look for rented properties. The investors market is driven by this demand along the OMR,” says Duraisamy Nadar, a local realtor active in the region.
In Porur, 1BHK units are being sold for Rs 17-49 lakh with covered area ranging from 400-600 sq ft. Rental values for similar configuration varies from Rs 6,000-10,000 per month. Situated in the western zone, Porur is home to several IT companies, chemical industries and manufacturing plants. Workforce employed in these companies and industries generally look for properties here.
The city as a whole has 34 per cent demand for rented 1BHK units, while its supply is just 11 per cent. Similarly, demand for 1BHK properties on sale is 11 per cent while its supply is 7 per cent. If the current situation persists, a rise in rental values can also be expected in coming months.
So, if you are looking to earn rental income but have a low budget, try investing in 1BHK units.
Source: Times of India / Ankit Sharma is a real estate writer with Magicbricks