Investing in Land Offers 10 Times Higher Returns than Ready Apartments: Report

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    A recent report by Colliers’ Advisory Services highlights that proximity to city centers, infrastructure, amenities, rental yield, and tourist attractions are all significant drivers of real estate appreciation in India. The report, titled “Top Investment Corridors in India,” emphasizes that investing in land and utilizing it for rental purposes can yield returns that are 10 times higher than ready apartments.

    The key factors contributing to property appreciation across the country, as identified in the report, include proximity to city centers, upcoming infrastructure projects, social amenities, tourist attractions, and affordability. The real estate sector in India continues to gain traction, particularly in major metropolitan cities, which are evolving as prime investment corridors.

    Swapnil Anil, Executive Director and Head of Advisory Services at Colliers India, stated, “Better infrastructure, affordability, higher rental yield, the potential for capital appreciation, tourist attractions, and proximity to city centers are all critical considerations when making investments. These factors, combined with the growing popularity of remote and flexible work options, have made tourism destinations in India increasingly attractive to investors.”

    Infrastructure development plays a vital role in driving investments and real estate growth, according to the report. Key growth drivers include factors such as employment opportunities, regional connectivity, access to healthcare and education, safety and security, environmental sustainability, good governance, and socio-political stability.

    Umakanth Y, Senior Director & Head of Delivery, Advisory Services at Colliers India, noted, “Micro-markets near financial and industrial hubs in major Indian cities are expected to become even more attractive in the coming years. Demand for villas, farmhouses, plots, and land in natural settings near major cities has increased twofold since the COVID-19 pandemic.”

    The report identifies specific hotspots in Maharashtra, such as Vasai Virar, Bhiwandi, and the Neral-Matheran corridor, driven by the availability of non-agricultural large land parcels, upcoming infrastructure developments, and the presence of reputable developers. The Neral-Matheran corridor, in particular, has gained prominence among investors due to its proximity to the city center and well-established amenities, including the Bhimashankar Wildlife Sanctuary, ND Film Studio, Neral-Matheran toy train, and Rambag point. The report predicts a fivefold return on land investments in this corridor over the next decade.

    Other emerging investment destinations highlighted in the report include the Sanand Nal Sarovar corridor in Gujarat, ECR in Chennai, Medchal in Hyderabad, New Town and Rajarhat in Kolkata. These corridors offer ample land availability, increasing tourism activity, and ongoing infrastructure development, resulting in an average annual rental yield ranging from 2.5% to 4% and land price appreciation between 6% and 8% annually.

    Furthermore, the report underscores the positive impact of proposed infrastructure transit projects, such as the Delhi-Mumbai Industrial Corridor and the Delhi-Ahmedabad High-Speed Rail Corridor in Ahmedabad, as well as industrial corridors along the Nagpur and Delhi-Hyderabad Highway, which are expected to boost the real estate sector.

    Also read: Rental yield expected to rise in 2023

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