After nearly a decade of Noida Extension being carved out and planned by the government agency, the region faces numerous civic woes – from bad roads and traffic bottlenecks, to overall infrastructure deficit. This raises the question, of whether mere affordability can continue to attract home buyers to invest here.
Developers remain optimistic about Noida Extension’s growth prospects
Nikhil Hawelia, managing director of the Hawelia Group, dismisses the notion that Noida Extension is only a destination for inexpensive homes. According to him, the market has just started shaping up and it cannot be dismissed, as just another affordable housing destination.
“Around six to seven years ago, when the first set of projects were launched, the price point was around Rs 1,800 per sq ft. Today, the average price point is Rs 3,600 per sq ft, with quality projects at Rs 4,000 per sq ft and above. This is an appreciation of more than 100 per cent, in a market that is still being occupied and at a time, when other markets across the country have remained subdued. The pricing, in the next few years, will definitely be comparable to the rest of Noida,” says Hawelia.
Nevertheless, the fact remains that a large share of ready apartments remain vacant, even if these have been sold out. Many buyers who bought apartments in Noida Extension, do not wish to shift to this locality, as the livability index is less than desirable.
Noida Extension: Key market indicators
- Price points in Noida Extension have not been able to breach Rs 4,000 per sq ft.
- Most of the properties are around Rs 3,000-3,200 per sq ft.
- There has been no price appreciation for over a year.
- JLL, in a report, had earlier declared Noida Extension as high-risk zone and advised home buyers to stay away. The report said that with around two lakh apartments coming up, the market is not likely to witness appreciation soon.
- Local public transport facilities are still not fully functional.
- Noida Extension has higher FSI and density norms, than Noida.
- Several physical infrastructure projects remain pending and social infrastructure is sorely lacking.
- There is no clarity, vis-à-vis the proposed metro for Noida Extension.
- Construction of most of the office spaces, IT buildings and SEZs, are behind schedule.
Sonali Pradhan, a bank employee, maintains that her decision to buy a house in one of the most affordable housing markets, has landed her in a lifelong soup. “Although I am living closer to Delhi, Noida Extension is no less than capital punishment. Every day, while going to office in the morning and coming back in the evening, I have to endure the traffic bottleneck at Kisaan Chowk,” Pradhan laments.
Rajeev Dayal, a local property agent, admits that Noida Extension has not grown beyond the tag of an affordable housing market. According to him, prospective buyers who come to him looking for a home in Noida Extension, do so for the reason of finding cheaper homes, compared to other parts of Noida, Greater Noida or Ghaziabad. “Out of around three lakh apartments that are planned in this market, not even one-third has been delivered. Moreover, you have traffic snarls throughout the day. Just imagine the scenario, when around 3-4 lakh cars, will be on the roads. The Greater Noida Authority is killing the golden goose, by not implementing the planned infrastructure developments in this micro-market,” says Dayal.
Urban planning experts caution that unless the Greater Noida Authority shows some urgency in executing the planned infrastructure projects, it will become challenging to live in Noida Extension. Properties that are being sold, are mainly because of the affordability factor. This has also mainly attracted the retail investors, as the organised segment of investors are not yet ready to bet on this market. Noida Extension, hence, has become a case study on how affordability alone, cannot be an investment magnet for any location.
(The writer is CEO, Track2Realty)