Rental houses in demand in K K Nagar as old buildings go away.

Reported by V. Soundararani

K K Nagar is predominantly a Housing Board (HB) colony with flats in varying sizes allotted to various income groups.

These are now over 30 / 35 years old and have become to show severe wear and tear.

Many such house-owners are going in for redevelopment now.

This trend is also affecting the rentals in this neighbourhood.

HB flat owners get handsome returns, by way of giving away the flat to private developers.

They get compensated with a brand new, modern-fitted flat with good amenities and additional cash too.

The real estate companies are able to build double the number of existing flats in the HB plot and sell the remaining in the market (the old apartments have vast vacant space around them).

This they do by exploiting the maximum FSI ratio that gives them the leverage to build triple times, even four times the existing floor space.

The going rate now is anywhere between Rs 7500 to 8500 per sq ft, depending on the builder’s name. The companies that are doing brisk business here are JD Builders, Green Peace and Land Mark.

Reputed builders from other parts of the city like Ramaniyam and GRN have also dipped into this local market and are carrying our operations.

The HB flat owners are also given allowance for relocation and rentals for an alternate residence by the joint developer real estate company.

The rate is now in the region of Rs 15000 per month upwards for the transit accommodation.

Most HB owners say this is a decent good compensation.

It is this trend that has pushed a surge in the demand for rented houses in K K Nagar.

As more and more TNHB units face demolition and house-owners move out locally, the demand and scale for rented spaces in the neighbourhood has risen.

Rents are now swinging between Rs.14,000 and Rs.18,000 for standard two bed apartments.

Agents say the rents have been going up for the past 2 years.

“You cannot get an average sized, decent apartment for anything less than Rs 15000 rent,” says Binita who had to move out of their HB flat and chose a rented space in K K Nagar.

The people who feel the heat are those who have been living in rented places the past years. Their owners are demanding more rent since HB owners can easily pay good rents – a minimum of Rs.15,000.

Radha, a tenant of a flat on Rajamannar Salai is house-hunting. ”We do not own a flat. Hence, we will have to continue to pay heavy rents in the future too. it is difficult for us to pay such fancy rents,” she said.

PSBB School is driving rental trends. Most people who have admitted their kids here want to remain here and don’t mind paying the new rentals.

There is another driver in this upsurge in rentals in K K Nagar and its environs.

The newly developed flats bought by NRIs are being furnished well and are let out for huge rents like Rs 30000 to Rs.40000.

Flats bracketed in that rental range are still available because their owner are willing to wait for the big bucks.

With the continuing boom in this HB to private real estate development in this region, rentals will also see a swing upwards.

S. BALASUBRAMANIAM has been in the real estate and rentals business in the area for many years. He is also a small builder. This is how he sees the rentals scenario in this area -

1.       K. K Nagar is an area where the facility of schools and  hospitals are good, an area that is very well connected with public transport, completely self sufficient area. There has been a huge migration to this area due to the schools especially PSBB.

2.       Most of the buildings in this area are Housing Board complexes where the full FSI has not been utilized. As they get re-developed by various builders, the builders offer the rentals for the construction period to the flat owners. Due to competition among builders to attract the flat owners the builders offer good rents. For example company X gives 18K for a 2 bedroom flat (which itself is high), while company Y competes and offers 20K. These amounts are peanuts for the builders compared to the crores the builder makes on a good project.

 

 


 
 
This entry was posted on Tuesday, May 31st, 2011 and is filed under News, Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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