October 11, 2005

Top quality apartments a new craze

By Sujit John & Srikala Bhashyam/TNN
Bangalore: Apartment complexes with central air-conditioning, heated pools, top-end electronic security systems and an entire floor of 4,000-5,000 sq ft to yourself. Villas with independent swimming pools to each unit, golf driving range, squash courts and bowling alleys. These are extremely exclusive properties, priced at over Rs 1 crore and going up to Rs 4.5 crore, but they are also super hot sellers in Bangalore. Ask anybody in this business, and the common refrain is: Demand far outstrips supply. This is particularly true in the central business district of Bangalore, says Farook Mahmood of a realty agency. Most property owners in this area prefer to do commercial projects, so there is short supply of top quality apartments. Because of this, some of such apartments are today quoting at over Rs 8,000 per sq ft. R Satyanarayana Murthy of another realty agency echoes that: There is a rush to pick them up. The demand comes typically from successful entrepreneurs, top executives of companies and NRIs. Deepak Krishnappa of Metrocorp, which is setting up a massive, highend 800-villa project close to Devanahalli, says about 60-70 per cent of the buyers are from the tech sector and about 20 per cent are NRIs. The easing of loan conditions has helped this trend. Earlier, only those who could muster a margin money of Rs 35-40 lakh could think of a Rs 1 crore loan. Today, what matters to banks is the ability of the customer to service the loan. And with the current level of pay packets, many customers are able to pay loan instalments running into several lakhs. HDFC in Bangalore receives 4-5 applications for a loan of over Rs 1 crore every month, says a company source. Professionals in the age group of 40-45, mainly in the top management cadre, constitute the primary crorepati borrowers. According to a HDFC Bank spokesperson, the tax concession has been the biggest booster for property. Earlier, properties with a price tag of over Rs 1 crore came with a good proportion of the price not being officially disclosed. Now, a lot of transparency has come in for availing tax benefits. There is a general improvement even in the quality of housing, he says. The tax benefits are also encouraging many to buy such properties for rental purposes. Ashirwad Agarwal, who is in the steel trading business and who lives in one of these top-end apartments, says he chose his particular property because he was keen on a place which would give his family more privacy. The builders reputation and the highest comfort levels were other things I looked for, he says.

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