Thursday, February 18, 2010

Karjat Visit

We visited Karjat last week - Karjat is about 2 hrs from CST on the central line, however, soon local trains would start running on the harbour line track which will reduce the commute to about an hour and fifteen minutes. As a result a lot of developers have started looking at Karjat to launch new affordable housing projects.

We visited three such projects - all at an early stage; two of them are yet to start construction. But we were quite happy with the price dynamics in the area. As of today, land is quite cheap, and thus a 3.5-4.5 lakh 1-BHK is still feasible. This is great news for a lot of people who earn between 8-15k per month and can afford an EMI of 3-4k per month. While we understand it is difficult to move to Karjat today as it is quite far from the heart of the city, it is a great opportunity to buy a home of your own for later, once good quality infrastructure develops in the area.

In our view, Karjat has the potential to be the Virar of the central line - roughly same commute from Churchgate/CST (once the new line is operational) and much cheaper properties.

All three projects are currently being reviewed by the project approval committee, more details will follow once they are approved. (Tentative launch date - Gudi Padwa - 16th March)

Saturday, February 13, 2010


We visited the Andhra Pradesh Housing Board ("APHB") last week in Hyderabad / Kukatpally after it announced the allotment of 1046 flats to the LIG segment - for more info on the project, see

As discussed in earlier posts, the biggest developer for EWS /LIG segments is the state (mainly through municipal corporations and housing boards) and in general, flats built by the state not only are good value (since there is an element of subsidy) but also generates a strong response from actual users. In the case of private developments, there is usually no screening of buyers - both in terms of income or actual users - so often the buyers are investors from higher income segments, not the group in which MHFC is interested.

Coming back to the APHB, we visited the site at Kukatpally which was very central and seemed prima facie attractive (right next to the site was a private development coming up at a rate / sq ft approx double that of the state project). We also met with officials and inferred from discussions that there were several allottees who were finding it difficult to raise financing for precisely the reason that MHFC exists - because the allottees lacked documentation and could not qualify for loans from mainstream banks. We hope to help these allottees and also help buyers on other housing board projects coming up in other cities and towns in Andhra Pradesh (over 5,000 "Siddhi" flats for the urban lower income segments to be offered in 2010). We felt that if we spread the word (that there is an institution like MHFC to support the informal sector) early, then the response to the state projects, while already strong, might be enhanced as more from the informal sector would come forward and apply for an affordable home.

Tuesday, February 2, 2010

Demand for EWS / LIG - new projects sold out

Re the Sanskruti apartments project (see blog post dated Dec 19, 2009), for 67 flats - this has already been sold out (in less than a month of being on offer - even without any real marketing by the builder / agent) - another sign of the demand for clear title, decent quality homes in the Rs 5-7 lakh price range in the Virar area.

Also, in the latest MHADA round (for sale of 3394 EWS / LIG homes), which closed Jan 31 - the total applications received are about 3.3 lakhs - or over 100 apps recd for each flat on offer.

For more info, see link below:
TOI article on MHADA sales - Jan 2010