Kerala Real Estate - What's to come in 2013?

2013 is fast approaching and real estate action continues in Kerala although not at a feverish pace as seen a couple of years back. The new year comes with a whole lot of promises for the real estate investor. With stock markets going in a see saw fashion through out 2012 owing to European crisis and slow recovery in the US market, only real estate and gold continues to be asset classes which have generated in excess of 10 to 15% return last year. Certain equity stocks especially in banking, fmcg and specific verticals have done well in 2012. Even as India's economic gurus foretell a future where inflation is expected to be around 7% and a full economic recovery seems far from certain across the world, the GDP growth expectation for India is less than 8% in 2013. Considering the above factors one would be wise to keep the bets alive on real estate sector in 2013.

From an India perspective markets like Mumbai received the jolts with thousands of unsold inventory creating panic in the Mumbai market, but since then market has kept steady there and not shown signs of a crash. Many investors who waited in the sidelines in 2012 hoping for a market correction or even a full blown crash have not had much to cheer about. Although prices have not shot through the roof as in 2010, or shown strong correction as in 2011,  2012 for real estate has been more of a steady year. Markets like Kochi have held steady and recovered from dips in 2011 and shown marginal signs of improvement in the last festive season.

Land sharks continue to rule the roost in most states with continued control of agricultural lands and large transactions which has an effect on property rates. With government bills (not yet passed) regarding usage of agricultural lands, real estate sector might see lot of new developments before general elections in 2014.

But developers today are much more cautious of announcing any project since investors are much more calculative than they were a couple of years back. We have also seen some incidence of developers not being able to keep their promises although not to the scale where many a projects remained undelivered in 2008 or 2009. Prudent buyers should always check for history of a developer before putting your money in any project even in 2013.

For Trivandrum, promises are aplenty in 2013. If you are looking to buy a flat within the city in Trivandrum next year, your choices would be far and few between. Most of projects are today being announced in areas like Menamkulam, MC Road, Sreekaryam which have at least a couple of acres of land that is required for a high rise project.For an investor looking to buy in the city in prominent areas like Kowdiar, Sasthamangalam etc. a good idea would be to lap up a flat sooner than later since prices are bound to rise due to fewer inventory in the coming year or so. New areas of development include Vattiyoorkavu and Peroorkada where villa and flat developers have shown renewed interest.

2013 also offers a good start for Trivandrum, with the opening of Technopark Phase 3 which should usher in a lot of new jobs and investment into the city. We had already mentioned earlier that commercial real estate does hold a lot of promise in Kerala in the upcoming future, with FDI in retail looking more and more a reality.  Although townships like the Bharitya city (recently launched in Bangalore), might still be 3 to 4 years away for Kerala, a lot of new project announcements from flat and villa developers are on the anvil as we approach 2013.

So the new year might after all prove to be an ideal one for existing investors to make money and new ones to enter the fray of real estate in Kerala!