When Gautam Mukherjee, 35, a marketing executive, thought about buying a house in Delhi within his limited budget, he had zeroed in on east Delhi’s Pandav Nagar. After scouting for and choosing a two-bedroom flat, he couldn’t buy it as no bank was willing to give him a loan.
With high prices of residential properties in Delhi, the only option for those with small budgets was to either land a Delhi Development Authority (DDA) flat in a housing scheme draw or a house in an unauthorised colony. But as buying and selling of properties in such areas was not authorised,
banks were unwilling to grant loans.
All that, however, will soon change after Delhi government’s decision to regularise 917 such colonies. On the flip side, property prices here too are now expected to go through the roof.
“At least 10% of these colonies are near affluent areas and are not cheap even now as prices here had already appreciated. The true impact of the government’s decision would be on colonies in the outlying areas of east or northwest Delhi,” said Ramesh Menon, Director, Certes Realty Ltd.
“Prices in many unauthorised colonies in south Delhi are already in the range of Rs. 30,000-35,000 per square yard and will touch Rs. 70,000 after regularisation,” said Pradeep Mishra, real estate analyst.
“Local property developers will profit the most from this decision but buyers should keep in mind that many such areas have narrow roads, inadequate power and water supply and lack of sewerage. Also, buyers should see if there is proper security and fire safety,” he added.Menon also said buyers should not jump into buying a property in areas that are being regularised. "Most such areas are bereft of any infrastructure such as proper sewerage or water connections apart from social infrastructure such as schools and hospitals. The government will provide the infrastructure after regularisation, which will take time. If you have the money, you can buy and move in here after the infrastructure is in place," he said.