Comparing Bhiwadi, Noida, Noida Extension

India’s urbanization is happening at a rapid pace. Numbers revealed by the 2001 census state that urbanization in India was at 27.8%. The subsequent census of 2011 revealed that urbanization had grown rapidly in ten years and stood at 31.16%, a 9.1% growth.

Recent data reported by The World Bank in 2017 indicate that urbanization has further increased to 34%. The World Bank further reports that India, along with China, the US, Nigeria, and Indonesia will lead the world’s urbanization rates by 2050.

As urbanization picks up speed across the country, traditionally preferred metros and other main cities are getting saturated, causing a host of problems like traffic, stagnant employment opportunities, higher costs of living, sky-high property prices and more. This is having a roll-out effect causing real-estate investors and end users migrate to emerging residential real-estate markets.

The Rise in Demand for Non-Metros for Real Estate Investors

A Hindu news article reports that by 2030, India would have 104 Tier-II cities, 331 Tier-III and IV cities, whereas the number of Tier-I cities would be only 155. Tier-II and Tier-III cities have been named as “new cities in the making.” Availability of large land parcels, increased demand for affordable and quality housing, development of smart cities, fast urban infrastructure development, rapid economic growth, the Housing for All scheme by the central government are a few reasons why real-estate developers and buyers have shifted their focus to Tier-II and Tier-III cities.

Here, in today’s post, we shine the spotlight on three such emerging real-estate hot destinations in the NCR (National Capital Region) corridor – Bhiwadi, Noida Expressway and Noida Extension, highlighting the USP of each destination and what makes it a good real-estate investment.

Bhiwadi (NCR)

The most sought after location for the middle-income salaried class working in Bhiwadi, though technically located in Rajasthan, is just off the NH8 highway and is part of the DMIC (Delhi Mumbai Industrial Corridor), giving it a geographical advantage. Considered as an industrial area, Bhiwadi has transformed into a full-fledged lifestyle destination in the last few years, making it a great choice for potential real-estate investors.

Here’s why Bhiwadi is right now one of the most-sought-after real-estate investment destinations in the country.

• Strategic Location – As mentioned above, Bhiwadi lies along the prime NH8 offering excellent connectivity to the rest of the NCR. Just 40 km away from Gurgaon and 55 km away from the Indira Gandhi International Airport, 60 km away from Faridabad, 90 km away from Alwar, the district headquarters.

The best part is that Bhiwadi is just under a 45-minute drive away from the IT hubspot of Gurgaon, making it easy for residents to “Live in Bhiwadi and Work in Gurgaon.”

• Social Infrastructure – While Bhiwadi has location advantage, the presence of robust social infrastructure is what gives its edge. Apart from seeing a rise in prime residential colonies, Bhiwadi is also witnessing a surge in office and retail spaces. Sky View Tower, V Square Mall, Ganapati Plaza, and BB Mall are some established and upcoming retail zones. Other projects like proposed metro rail connectivity, bullet train further up the investment quotient of Bhiwadi.

• Higher Standards of Living – The standard of living in Bhiwadi is much better than Delhi and Gurgaon, says Ankur Gupta, JMD of Ashiana Housing. A large number of hospitals, nursing homes, schools, and proposed roads provide residents with all essential amenities. A green zone has been proposed in the SE of the city, which will house higher educational institutes.

• Rapid Economic Growth – Industry friendly policies by the government of Rajasthan are acting as a catalyst in attracting industries to Bhiwadi. Leading Indian and international corporations like Bausch and Lomb, Pepsi, Mahindra, Honda Ceil, Gillette, and several others have set up base in the fast developing industrial areas of Bhiwadi. With over 300 big MNCs and hundreds of MSMEs, Bhiwadi has emerged as an industrial town, with plenty of employment opportunities.

• Capital Appreciation – Property prices have seen huge capital appreciation in Bhiwadi in the last few years. In 2012, property in Bhiwadi was valued at 1700 INR per sq.ft, today it has increased to 3000 INR per sq.ft.

• Low Floor Area Ratio (FAR) – FAR is one of the most commonly used terms in real estate. But, now many buyers are aware of what it exactly means. Here’s a quick definition – it’s the ratio of the floor area (built-up area) in a building to the plot area on which the building stands. Let’s illustrate FAR with an example. For instance, let’s assume that 3000 sq ft of built-up space stands on a 1000 sq ft plot, then the FAR is 3. The standard FAR in Bhiwadi is 2.00 (source: point (X), page-12, Unified Building Bye-Laws 2017, Rajasthan) which is far less compared to other highly-dense cities like Delhi and Gurgaon. This means you have plenty of green spaces and low concentration of people per acre, providing you with an uncongested lifestyle in an urban environment.

• Low Inventory Overhang – A report published in PropEquity reveals that nearly 71% of properties in Bhiwadi are sold within one year of listing. The inventory overhang in Bhiwadi is far lower compared to other cities nearby. With properties likely to sell at a faster rate, property prices increase at a higher pace in Bhiwadi.

Where to Invest in Bhiwadi?

You can consider areas such as sectors 24, sector 77, sector 39, off Alwar road, Vasundhara Nagar, highway etc.

Noida Expressway

The Noida Expressway runs for a distance of 25 km and is a six-lane highway, connecting Noida to the Greater Noida region. It starts at Sector 15 A of Noida and ends at the Alpha commercial belt in Greater Noida. South-East Delhi is only 40 km away from the Noida Expressway. Noida expressway has emerged as a good destination for people residing the Noida but it’s certainly not ideal for people working in Gurgaon. The nearest mall is GIP which is more than 15 km away. Its standard FAR is 2.75 (source: para 24.2(ii), page-19 of NOIDA building regulations,2010), hence offering ample of green space in the condominiums.

Here are a few reasons why investing in residential properties along the Noida Expressway is a worthwhile investment.

• Rapid Economic Growth – The Noida Expressway is part of the Taj Economic Zone and is fast developing into a modern suburban area, with a robust infrastructure. A proposal has been made to connect the expressway to downtown Noida, via metro to the station Pari Chowk. Noida Expressway has a job market of its own, which fuels the economic growth of this region.

• Planned Development Zone – The Noida Expressway is part of the Noida Master Plan for 2031. It’s a planned city that follows sustainable growth and being developed with planning. This eases traffic congestion on roads. It serves as the perfect model for far-sighted town planning in the country.

• Social Infrastructure – The Noida Expressway is home to several hospitals, educational institutions, recreational zones, retail complexes, commercial centres and more. The major hospitals in this are Jaypee Hospital, Felix Hospital, and JS Hospital. The leading schools and educational institutes here include Shiv Nadar School, Mayoor School, Gyanshree School, Ideal ITC College and more. The X Mall, DLF Mall of India, and Ansal Plaza are some popular commercial centres in this area. The standard FAR in Noida is 2.75 (source: para 24.2(ii), page-19 of NOIDA building regulations,2010)

• Inventory Overhang : 68 months inventory overhang in Noida (both Noida extension and Noida expressway combined as per a PropEquity research report)

• The biggest disadvantage – Noida Expressway has is that it does not have the required social infrastructure as of now. The closest mall is 10-12 kms away. Majority of the development will take place near the Jewar International Airport.

Where to Invest in Noida Expressway?

Recent projects are clustered around the following sectors – Sector 124, Sector 44, Sector 158, Sector 153, Sector 149, Sector 96, and Sector 128.

Noida Extension (Greater Noida West)

Greater Noida West popularly known as Noida Extension or the Greater Noida Industrial Area is a region located at the intersection of the western and eastern freight corridors. Noida extension also has the crown of being amongst the affordable housing destination. It lies next to Noida, one of the biggest industrial townships in Asia. Greater Noida is also the gateway to the DMIC (Delhi Mumbai Industrial Corridor). Set up in January 1991, Greater Noida was established to decongest Delhi, by attracting population with economic and urban growth.

One of the biggest drawbacks of Noida Extension is higher FAR. For instance, it’s common to see nearly 4000 flats constructed in an area of 15 acres, which reduces the available green space for an individual. The standard FAR in Greater Noida is 3.5 (source: para 3(2), page-2734 of Gr.NOIDA building regulations(second amendment),2013)

When Greater Noida reaches its maximum capacity, it would have nearly 300,000 families living within a radius of 5-7 km. Though it has a 4-lane road running through it, it’s expected that roads would be congested with bumper-to-bumper traffic especially during rush office hours.

Earlier the government under Akhilesh Yadav had approved construction of a 15-km metro project to connect Greater Noida’s Knowledge Park 5, near Ace Divino with Noida Sector 71. Even though the GNOIDA authority has approved the project, it has been halted due to budget troubles. With no progress being made, residents are sceptical whether the project will ever see the day of light.

With that said, here are 3 reasons why investing in real-estate in Greater Noida pays handsome returns.

• Excellent Connectivity – Greater Noida is at a distance of 63 kms from Delhi. And, the 30-km-long Noida-Greater Noida metro line, the travel time to the national capital will be reduced further.

• The perfect destination for Mid-income, Affordable Housing – When compared with the other key destinations on the NCR including Sohna (Gurugram), Yamuna Expressway, Greater Noida West, Ghaziabad and Bhiwadi, Noida Extension offers plenty of scope in the affordable housing segment.

The majority of apartments in Noida Extension ranges from 700 sq.ft to 1500 sq.ft, compared to other regions in Noida, where average flat sizes range from 3000 sq.ft to 4500 sq.ft.

• Massive Economic Growth – The government of Uttar Pradesh has selected the regions of Greater Noida, Yamuna Expressway and Noida for developments in the field of smartphones. The Korean smartphone maker Samsung has its biggest manufacturing facility in the country at Sector 81, Noida. Intex, Lava, Oppo, and Karbonn are other smartphone makers who have manufacturing units in this area.

• Inventory Overhang – 68 months inventory overhang in Noida (both Noida extension and Noida expressway combined as per a PropEquity research report)

How to Invest in these Emerging Real-Estate Destinations?

You have several choices to park your surplus funds in these upcoming destinations. You can invest in apartments, row houses, villas, plots, commercial spaces and even in other value-added real-estate properties like child-centric homes and senior homes.

Invest in these emerging markets quickly as due to increasing demand, properties in these areas are not likely to be available on the market for long.