How urban traffic affects the property market

Can something as seemingly simple as fewer traffic snarls lead to healthy growth in the real estate market? We look at the connection between the two

With rapid urbanisation, the biggest challenge faced by cities and metropolitan areas, is traffic congestion, which also hinders the development of the real estate sector in such cities. Increasing population, has put significant stress on the existing infrastructure in cities, says Tushad Dubash, director of Duville Estates. “There has been rapid urbanisation in the metro cities of India, which has led to an increase in demand for mobility. This is leading to increased use of private vehicles, congestion on roads, pollution, public safety issues and increased household spending,” adds Dubash.

With traffic snarls affecting stress levels and hampering productivity, people nowadays prefer homes that are close to their work place. Presently, almost all metro cities in India have infamous traffic bottlenecks and the real estate markets in such regions often struggle, as home buyers prefer to live in places that offer easy connectivity.


How traffic congestion affects the growth of the real estate market

As more people prefer to have their own vehicles, the increasing density of vehicles on the roads, adds to the woes. Owing to traffic congestion, only certain specific pockets of cities witness developments, which affects the growth of commercial realty. This constrained development, results in changing of city centres, with newer ones coming up, elaborates Pratik K Mehta, MD of Unishire. “For example, in Bengaluru, we have Hebbal, which is considered to be the new city centre with the development of both, residential and commercial/ office spaces around it. Mumbai witnessed such a shift years ago, when Bandra-Kurla Complex (BKC) came up,” says Mehta.

See also: Centre frames new Transit-Oriented Development policy


Traffic and its impact on affordable housing

With decongestion in traffic, people can afford to live at distant locations, which are affordable and commute to work daily, without spending too much time, adds Mehta. “This will improve real estate development and growth, across all parts of the city. Currently, the government is talking about affordable housing, which is not possible in commercial city centres. Paradoxically, most people prefer commercial centres, to cut down on their travel time. Thus, for affordable housing to be meaningful, it is important to ensure seamless travel, from affordable locations to work places,” Mehta explains.


What is the government doing?

Numerous infrastructure projects that are underway in the metro cities, could improve connectivity within the city, as well as to areas on their outskirts. For example, the introduction of metro rail services, could bring traffic under control. However, till the entire metro network is established, traffic woes are likely to continue. Moreover, although the government is taking several steps to decongest cities, these may not be enough. Often, project delays and lack of planning for the future, mean that by the time the project is completed, the traffic situation is considerably worse and does not cater to the future demand. Well-planned and quality mass public transport systems, will not only decongest traffic and allow people to travel across the city in minimum time, but also ensure that real estate gets ample space to grow.


Problems due to congestion in metro/big cities

  • Pollution faced by residents in the congested areas.
  • Time lost in commuting.
  • Imbalance in the work and social life, of the people living in such areas.
  • People restrict themselves to work that requires less commuting time.
  • Realty development becomes difficult, owing to the lack of space, congestion and inadequate infrastructure.
  • Property prices become unattractive, due to lack of amenities.


The government of India plans to invest Rs 3 trillion (USD 44.73 billion), for developing 35,000 km of roads across the country, of which, 21,000 km will be economic corridors and 14,000 km will be feeder routes, which is expected to improve freight movement, ease traffic bottlenecks and improve inter-city connectivity. – Information as per


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