Maduravoyal used to be a small village, to the west of Chennai, but not anymore. Today Maduravoyal is humming with activity as more home buyers interested in investing in Chennai are scouting around in these parts for apartments and builder floors which suit their pockets.
Maduravoyal, which became a precinct under the Chennai Corporation in 2009, was earlier known as the Ettavaddhu Mile or the eighth mile, because that was the distance to the Chennai Port. The demand for space in this locality started to pick up with the setting up of the Koyambedu market, which is just three kilometers away.
The localities close to Maduravoyal include Valasaravakkam, Alapakkam, Porur, Vanagaram, Mogappair and Nerkudram. Once this area came under the city corporation, civic infrastructure such as roads, sewerage, electricity and water have been provided which has accelerated the growth. The Chennai Metropolitan Development Authority has developed this locality and has divided the residential space into Nagars or colonies.
Phase II of the Chennai Bypass runs though Maduravoyal; however, the increase in land and property prices started a few years back when the Maduravoyal Junction and the cloverleaf interchange became operational. But progress on the Chennai Port – Maduravoyal Expressway, a 19 km long elevated corridor, which will provide easy access to the Chennai Port, is slow as it has been mired in court cases.
The capital values in Maduravoyal range between INR 6500 per sq ft and INR 5000 per sq ft. There is a lot of demand for smaller apartments on rent. Places like Maduravoyal are gaining in demand from home buyers as the conservative Chennai market is in the process of changing. People are willing to move away from the traditional residential areas such as Adyar, Anna Nagar and T. Nagar, as the prices in these places have gone through the roof. This has been compounded by the fact that no land parcels are available, within the city’s premium areas to construct, as well as the high cost of the FSI (floor space index).
It would be extremely difficult for a young couple or first time home buyer, who is dependent on a home loan, to buy a house in one of the prime localities. Since the city is expanding and better roads and transport makes commuting easier, there has been a migration towards the outskirts of the city.
The new trend
One of the newer trends that Chennai would be witnessing is the growth of townships on the peripheral areas. These townships offer a better quality of life with more green cover; school, health club, swimming pool, children’s play area and security. They are better organized and better planned.
Chennai, like other metro cities, too has unsold inventory of 64 million sq ft. One of the prime reasons for the increased supply has been that many developers rushed in to construct new apartments banking on the surge in demand from young professionals. Since this demand is dependent on the uptick and the down swing of the IT industry, it resulted in over capacity in residential space. This has forced builders to resize the carpet area, making apartments smaller and also delay launches.
The built up inventory is getting absorbed at a very slow rate, mainly because the builders are not willing to reduce the prices. Builders, on the other hand, say that it would not be possible to reduce the prices because of the high cost of borrowing as well as the increased cost of raw materials such as steel and cement.
According to reports, the demand for housing is quite stable in Chennai, with about 28,000 to 30,000 sq ft getting absorbed every year. Most people who invest in apartments in Chennai do so for their own use. The people who buy houses as an investment plan to sell out within a period of five to seven years.
Nina Varghese for IndiaProperty.com
Image: By VtTN (Own work) [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons