Pune Property

Concrete prospects for individual investors

Pune real estate offers good opportunities and a reasonable rate of return

During the past few years, an increasing number of Mumbaikars have become conscious of the scope for capital appreciation in real estate. While prices within Mumbai are quite high, cites like Pune still provide investment options that are within their means. However, for such investments to really pay off, it is essential that one is able to lease it out without much effort, that too for a reasonably high rental. The calibre of people leasing the unit is also important, as is the manner in which they maintain it. Both definitely have an impact on its perceived value over the long term. This is another area where Pune scores over most other cities. I mean sure, you may be able to buy real estate at cheaper rates elsewhere, but then how will you generate returns without leasing out the unit at a good price? The sustained ITES and Auto boom taking place in Pune ensures that there will continue to be a steady demand for leased accommodation for years to follow. Also, when one considers the type of people who would be occupying the residential unit, software professionals call centre managers, and automobile industry consultants, it’s obvious that they would take good care of the place and there would be no chance of it being misused in any way. Pune real estate offers investors a lower entry cost, regular returns and a better quality of tenants than most other cities. No wonder most Mumbaikars have been driving down on weekends for site visits and to compare options. PK Mallawat, MD, Allwin Securities Ltd already owns a house in Pune apart from the one that he has in Mumbai. The one in Pune is for investment purposes. It has been given out on lease to a family for a specified period of time. “During the time that it is vacant, I go there with my family, generally one to two times a year. The reason behind my decision is that Pune is a developing city. It is attracting more and more people towards it every day. Pune also has a lot of temples and ashrams, which provides an additional motive behind my purchase,” he says. Sudhir Pande, factory manager at Mother Dairy Fruit and Vegetable Pvt Ltd, explains the reason behind the trend of Mumbaikars being interested in purchasing a second home in Pune. “Pune is a very good place to live in, especially for the people of Mumbai since it is so close and easily accessible. Also, as an emerging city, it is an amazing place for families in which both, husband and the wife, are working in the IT sector. It has a number of IT industries apart from very good colleges and other educational facilities. Another cause could be the population of the city. According to me, Mumbai is so crowded that people could also buy a second house there and drive over for weekend getaways,” he feels. Providing a similar perspective is Tarun, who shares, “Pune is an excellent place for investments. The scope to lease out flats is also good, especially near the areas where the universities, colleges and IT industries are centred. Lifestyle in Pune is similar to that of a metro with a better atmosphere as compared to Mumbai and provision of all the basic amenities. There are all kinds of brands available here as well.” Dr Mahesh Borse has his own consultancy and two houses. While his second home is in Mumbai, he spends most of his days at his first house situated in Pune. He points out “Pune was labelled as a pensioner’s city due to the large number of retired citizens. But, in the last ten years, it has changed drastically. With the setting up of various IT industries and education universities, Pune is now referred to as a mini-metropolitan city. Pune has grown because of the innumerable people that it has attracted and gratifies. There are so many roads going out from Pune to different cities of this country. Along these roads have developed, areas of settling population.” In his opinion, the new areas of Pune are even better than the best parts of Mumbai. Hinjewadi, close to Pune, houses many software companies and is like major business areas in Mumbai such as Nariman Point. Having an image of a Maharashtrian city, people also buy houses to accommodate their children studying in the fine colleges and universities situated here. But, a large number of people buy houses in this city for investment purposes. Pune also has the kind of playgrounds that are absent in Mumbai, three stadiums and few of the IPL matches are also being played in the stadium nearby. Lastly, the climate of Pune is better than that in Mumbai. It is cooler and pleasant over here. Bhawani Nandwana of Prachi Pharmachem is planning to buy a second home in Pune, “where I and my family can stay during our holidays. Furthermore, I conceptualize it to be my retirement house.” Rakesh Singhania, president and CEO, Aparna BPO Services Pvt Ltd, elucidates, “The three main factors responsible for the trend are proximity to Mumbai, equivalent infrastructure facilities and rates at one-third the price of that in Mumbai. This is making people want to come here, a retirement option being supplementary. Even I, already owning two flats, recently bought another one, some 15 km from my place for investment. I do not intend to give it on lease but use it for weekend stays.” Pune, he feels, is a multi-sectored city with automobile, IT and education. It has a huge moving, more specifically a floating crowd comprising of engineering and management students and employees who leave the city in 2-3 years. Because of this reason, the scope of finding a house on lease is wide. The lifestyle in Pune is as good as that in Mumbai, it is a safe city where one can freely walk on the streets till midnight. Earlier, the trend here was of building huge houses but has now changed to building big townships with 200-300 small houses. This is due to the high demand as well as the want for basic amenities. “Being a father, even I require at least one to two amenities like a party hall for celebrations, a swimming pool in my complex etc,” Singhania points out. Residing in Pune from the past 25 years, chartered accountant Ravi Nevatia, says, “Mumbai people find property rates very cheap in Pune as compared to that in their city and therefore buy a second house for investing or weekend stays. Even for those who have children studying in Pune, buying a flat here and coming over to stay for a few days is not a bad idea. Even after so much development, life in Pune, as compared to all the big cities of India like Delhi, Kolkata, Mumbai, etc, is very much peaceful, calm and composed. In better parts of the city, there are innumerable people looking out for houses on lease for half a year or so, rates being Rs. 10,000 to 15,000 for a 1000-1500 sq ft flat. As for purchasing a flat, property rates have gone up in the past two three years.” Sajjankumar Tulsyan, proprietor, Ram Techno Pack, expresses, “The climate in Pune is better as compared to that in Mumbai and it is a good place for people desirous of starting up an industry or a business. One can find all the facilities and as far as investing in property is concerned, the appreciation earned is good. Due to the IT industries, the scope to lease out flats is also broad and the owner can find good customers very easily. Growth in Pune is positive with numerous automobile industries apart from IT ones. Home to several production houses, Pune is a city offering a lot of job opportunities.”