Ahmedabad's youngsters poorer property buyers as against other comparable cities, says survey

By Rajiv Shah 
An Indian Institute of Management-Bangalore survey, in coordination with magicbricks.com, India’s top property portal, has found that Kolkata’s and Ahmedabad’s younger generation is a relatively poor buyer of residential properties as compared to other comparable cities. Seeking to identify Housing Sentiment Index (HSI), the survey has found that Kolkata’s and Ahmedabad’s 25-40 age group form 61 per cent of the housing property purchasters, as against 64 per cent in Mumbai, 67 per cent in Gurgaon, 74 per cent in Hyderabad, 75 per cent in Bangalore and Noida, and 77 per cent in Pune.
While a further breakup by the survey suggests that Ahmedabad’s housing property buyers in the age group 25-29 form the highest of all these cities, interestingly, majority of those wanting to buy property in Ahmedabad earn less than Rs 10 lakh per annum. It says, “62 per cent of those earning less than Rs 10 lakh per annum look to buy in Ahmedabad”, which is the highest compared to other cities. For instance, 30 per cent such buyers, earning less than Rs 10 lakh per annum, are from Gurgaon.
Not without reason, Ahmedabad is one of the cities where a higher percentage of buyers go in for cheaper houses. Thus, in Ahmedabad 23 per cent of those wanting to buy up houses want to lock a deal for less than Rs 20 lakh, and another 41 per cent want to lock it up for between Rs 20 and Rs 40 lakh. While in Kolkata 31 per cent buyers wish to purchase property less than Rs 20 lakh, and another 35 per cent for between Rs 20 and 40 lakh, in all other major cities the buyers wish to go in for higher-end properties.

Thus, in Gurgaon, 56 per cent of buyers wish to buy property worth Rs 60 lakh and more, even for more than Rs 1 crore; in Mumbai, there are 24 per cent such buyers; and in Delhi 22 per cent of the buyers wish to purchase property for more than Rs 60 lakh. In other cities – Kolkata, Hyderabad, Chennai, Bangalore, Pune, and Noida – anywhere between 22 to 34 per cent buyers wish to purchase property for between Rs 40 and 60 lakh.

The survey says, “Bangalore remained the first choice for sellers looking to invest their proceeds in property.” The reason is simple: It is in this city that 51 per cent of those who want to buy up houses are IT professionals, as against 47 per cent in Hyderabad, 45 per cent in Pune, 29 per cent in Chennai, 20 per cent in Gurgaon and Mumbai, 19 per cent in Delhi, 17 per cent in Ahmedabad, and 15 per cent in Kolkata. In Ahmedabad, majority of the housing property buyers are in the “self-employed” category (but are not manufacturers).
Arriving at housing sentiment index on the basis of its analysis, the survey says, “less than 100 suggests that buyers expect prices to remain at current levels, while values lower/greater than 100 suggest that buyers expect prices to fall/rise.” It points out, “Barring Hyderabad and Noida, all other cities posted an upward trend. Mumbai posted positive HSI of 106 for the first time in four quarters.”
“An aggregate HSI score of 117 for the 10 cities surveyed indicates expectation of a price rise over the next six months”, the survey says, adding, “Among cities, Bangalore, with an HSI of 140, leads the list followed by Kolkata with an HSI of 132. Noida, which experienced a 33% increase in HSI in the previous quarter, fell by 4% to 124. For the first time, Mumbai shifted to positive HSI of 106.”
Further, “In Mumbai, with an HSI of 106, rose 24% to record the first positive HSI score in four quarters. Noida, which increased by 33% in the previous quarter, fell by 4% to 124 while Hyderabad fell by 4% to end at 97.” The survey underlines, “Ahmedabad is the only other city (after Hyderabad) with an HIS below 100.”