Rental and Purchase Demand Increases in Chennai’s Premium Locales

Are you unwilling to compromise on the lifestyle you are leading for a Chennai house? If you like amenities, strategic locations and lots of amenities then you should consider living in Chennai’s premium locations such as T Nagar, Anna Nagar, Adyar, Nungambakkam and Kilpauk. You can buy a flat or house in this area if your budget is between Rs 1 and 6 crores!

Not only do these areas offer good amenities and lifestyles but also high rental returns. For instance, Adyar has shown a constant increase in rent values in the past 6 months. In the first quarter of 2014, the rise in rent was around 13 percent whereas in the second quarter it rose by 7 percent. Most people wanting house for rent in Chennai have enquired about properties in Adyar but in the past few months, the enquiries have increased manifold. The conversion rate too has increased which has further strengthened rental values.



The increase in rental values certainly is good news for investors of the area who want healthy returns on rent. Despite an increase in rent, tenants are not shying away from the area. Adyar happens to be among top 10 localities preferred for rent in Chennai. The constant demand for rented accommodation in this locality is mainly from IT professionals and locals. Most of them want to live in premium areas of Chennai which is why they enquire about property in Adyar. The price of property in Adyar is quite high which may make it out of reach for most middle class and upper middle couples but renting property here is certainly possible. The average capital value in Adyar is around Rs 12000 to Rs 15000 for square feet which make it one of the most expensive areas of the city. However, the rent in this area is around Rs 25,000 to Rs 30,000 in a month.

Currently, multi-storeyed apartments, builder floor units and some house for rent in Chennai Adyar are available here. The most supplied unit in this area is the 3BHK flat which may be leased for Rs 25,000 to Rs 75,000 in a month while for a 2BHK flat; the rent is around Rs 15,000 to Rs 40,000 in a month. Adyar’s closeness to IT areas and its location by the OMR or Old Mahabalipuram Road has made it a favourable place for renting apartments in Chennai. Some of the IT parks which are located close-by are the Rajiv Gandhi IT Park, Ramanujan IT City and TIDEL Park.Adyar enjoys public transport services which makes connectivity to other areas of the city easy. Businessmen would find living in T Nagar convenient because of trade areas located nearby.

Because of civic and social infrastructure along with closeness to employment hubs, many buyers conscious of their lifestyle prefer staying in these areas. If your budget is not very high to be able to afford living in these areas, you can consider living in house for rent in Chennai in these areas. These areas are much in demand by rent-seekers because of their location and amenities. There are a lot of HNI individuals whose annual earnings are more than Rs 30 lakhs who buy properties here while those who want to stay here but cannot afford to purchase properties prefer to rent houses.

Tenants are uninhibited to shell out Rs 25,000 to Rs 50,000 in a month for enjoying the easy access to various facilities. Renting an apartment here reflects tenant aspirations apart from the fact that they want to live near the city. Anna Nagar and Adyar have been quite popular among tenant in the first quarter of 2014. Investors have capitalised on these and their rental yields have been quite encouraging. An investor stands to earn Rs 60,000 in a month from a 4BHK house in Kilpauk while in Nungambakkam, s/he can earn around Rs 70,000 in a month from 3BHK multi storeyed flats.

Most of the 3BHK apartments in Anna Nagar and Adyar can be rented for Rs 40,000 to Rs 50,000 in a month. In T-Nagar, the rent for property may be as high as Rs 1.5 lakhs in a month. Most businessmen in other areas of Chennai come to T Nagar because of its closeness to business locations. Corporate lease is quite common in most locations here. These popular places in Chennai have a lot of buyers flocking to them. A lot of people recycle their properties in peripheral Chennai, Madurai or Coimbatore to opt for an expensive residence in a promising and premium location of Chennai when the question of basic physical and social infrastructure is concerned.

Re-Development in Chennai

Even though a lot of these locations are becoming saturated, they are being redeveloped and the concept has caught on quite quickly in various areas. A lot of these posh locations are being redeveloped into 3, 4 and 2BHK flats for sale. Because the numbers of investors in this area are high, tenants too shall benefit from occupying flats which have been made over.

For developers, the benefit of obtaining better buildable spaces without investing any money is quite irresistible. Owners too benefit as their old flats are given a facelift. Some of the redevelopment stances include improved architecture and better interiors, covered car parking facilities, flooring and an entirely modern outlook. Redevelopment also considers modern governmental norms such as the FSI or Floor Space Index where older buildings are bulldozed to create new ones keeping in line with government regulations.

Areas such as Besant Nagar, KK Nagar, Indira Nagar and Shastri Nagar in Chennai are opting for re-development. Some of these areas were developed by the TNHB or Tamil Nadu Housing Board almost 40 years back and required such stances of redevelopment. Even those apartments which are held privately in Nungambakkam have undergone redevelopment. Because premium localities are reaching a point of saturation, almost half of the existing properties are undergoing make overs.

If you want to live in a posh locality in Chennai as a buyer or tenant, then you should definitely consider living in one of the localities mentioned above.

Localities Where You Can Rent Properties in Chennai

Chennai is a booming city because of the growing IT and automobiles sector in the city. The city is known as the Detroit of Asia because it produces roughly 40 percent cars for the whole country and a lot of it is exported as well. The OMR is one of the areas where demand for rental and ownership properties is at its peak. There are several other areas in Chennai that you can explore if you are looking for house for rent in Chennai. These areas also offer good apartments on rent at reasonable rates with lots of amenities.

Besant Nagar 

Those wanting to live in this posh locality can easily rent an apartment for Rs 30,000 to Rs 60,000 in this area. The worth of such a property would be around Rs 3 crores and its size would be between 1400 and 2300 sq. ft.The style of the apartments would be 3BHK which is most common here. To buy an apartment here, you would have to spend anything between Rs 90 lakhs and Rs 10 crores. The steep price is certainly unaffordable for most and hence they can opt to stay in a rented accommodation here.

The capital values of apartments and houses in this area are very high which is why HNIs and upper middle income individuals can stay here. This is one of the reasons why most middle class and upper middle class people wanting to stay here opt for rental properties rather than purchased ones.

If you want smaller apartments, you could opt for a 2BHK one which can be rented for Rs 25,000 to Rs 30,000. The size of such an apartment would be around 750 sq. ft. to 1100sq. ft. For such an area, the capital values would be around Rs 0.9 crores to Rs 1.5 crores.

Apart from flats, residential houses can also be rented here. High ranking government officials usually own such kinds of properties. Owners prefer to give out this house for rent in Chennai to families. Sales of such stand alone houses are very rare although their availability as rental property is quite high. The rent for properties between 600 sq. ft. and 2500 sq. ft. is around Rs 15000 to Rs 70000. The capital values of houses which are between 700 sq. ft. and 4,500 sq. ft. is between Rs 1 crore to Rs 13 crores.

The kind of people who rent apartments and houses in Besant Nagar are locals and individuals wanting to live in premium localities. IT professionals who work on offices in OMR or Old Mahabalipuram Road also prefer to rent apartments here.

Why opt for Besant Nagar

Since 1970, Besant Nagar came into prominence as Tamil Nadu Housing Board created it. The area has lesser traffic, wider roads and much scenic beauty. The area is also close to Eliot’s Beach and has a magnificent sea view. These factors contribute to the popularity of the area.

The Eliot’s Beach is one of the longest beaches in Chennai as it measures 2 to 3kms in length. The localities close by also have beaches but they are quite crowded and small. Therefore, those wanting a locality close to the beach prefer Besant Nagar.

Besant Nagar is in proximity to both the East Coast Road or ECR and Old Mahabalipuram Road. The area is also connected to Sardar Patel Road via Besant Avenue Road. This linkage also helps to connect Besant Nagar with the Railway Station and International Airport. As it is a premium and old area, Besant Nagar also enjoys high civic and social infrastructure.

Tambaram

Even though it is a very old locality of Chennai, Tambaram is one of the most preferred areas in Chennai for buying homes. Because of high demand, there has been a steady increase in property prices. The appreciation in capital values of Tambaram has been around 15 percent in the past year and around 22 percent in the past couple of years.

What has put Tambaram on the popularity list is its regular upgrade in civic and social infrastructure. The Municipal Corporation of Tambaram has undertaken newer initiatives which not only improve the condition of the area but also act as examples for other municipalities. Some such initiatives include the UGS or Underground Sewage program for cleaning the locality. To solve the problem of water logging, concrete roads are being constructed over sewages.

BINS, a first time programme for solid waste management has been started in 5 places. The municipality has plans of installing them in more than 150 other areas in the neighbourhood in the coming future. These BINS are semi-submersible which solves the problem of garbage in the area. Residents have started separating the wastes themselves and are putting them in the different bins in order to make the work of municipality workers easier. For capturing public behaviour and efficiency, CCTV cameras have been put up in two places. Bio digesters, Namma toilets along with community kitchens are some of the other initiatives undertaken by the municipality. These projects are all interlinked to one another. For taking care of sanitation issues in slum localities, public toilets were started which have bio-digesters installed underneath them. These bio digesters convert the waste into methane gas which is then piped to community kitchens for feeding 300 families.

Residents of Tambaram have shown full support to these initiatives and these have contributed positively to the locality’s popularity.

Scenario of Real Estate

Along with the improvement in civic infrastructure, there are several reputed IT companies and educational institutes present here. These enjoy easy rail and road connectivity with other parts of the city and this has led to an increased demand here.

High Net Worth Individuals or HNIs, Non Residential Indians or NRIs and IT professionals are the largest demanders of properties in this area. The demand comes from both end users and investors.

Apart from buyers, medium and big developers are also concentrating on the area because of the increasing demand. For now, more than 40 projects have come up which are in different stages of construction. Tambaram is around 27kms from the city centre and is located on the Trichy-Chennai Highway. The Chennai Suburban Railway Network passes through this area, making it one of the busiest.