The correlation between building road infrastructure and restricting house prices to moderate levels in Indian metros is shown in the above graph.
Length of road construction is known to have a direct bearing on real estate anywhere in the world and our Delhi is no exception. But what is the correlation of Roads and prices in Delhi real estate market? Does road building check property prices in Delhi or they help them to rise?
This holds for Gurgaon city connectivity but what about roads built to connect Delhi with other areas of Delhi?
If more roads are constructed to connect the state capital, Delhi, with other parts of Delhi, property prices rise in Delhi as the demand for property in Delhi increases from people all over Delhi. The very best example has been the construction of Gandhi Setu in 1980s. It led to introduction of APARTMENT culture in Delhi.
Currently, the only solution to the problem of urban housing shortage in Delhi is building new infrastructure to connect more outer areas to the city centre. We at Buy Commercial Property feel that when new roads are constructed across rural and urban areas in Delhi, the spread of development happens over a wider geography. These potentially bring down the premium that certain urban centres in Delhi command for having better connectivity. This is particularly true for our infrastructure-starved city, Delhi.
Fortunately, road infrastructure has emerged as a key focus area for the current state government. The young Deputy CM of Delhi, is keen on improving connectivity in and around Delhi at a greater pace. According to media reports earlier this year, he has an ambitious plan to connect Delhi with the most distant part of Delhi within Five hours. This is expected to improve freight movement, ease traffic bottlenecks and improve inter-city connectivity in the state. It will be interesting to watch residential property price movements in the coming years in Delhi after completion of a number of road highways and bridges in and around Delhi. We say so because as soon as roads are laid the adjacent land owners start demanding prices in multiples of previous price, and real estate prices in Delhi are driven therefore more so by land component than construction and other soft costs. Strict restriction in land usage in Master Plans with no change permitted later would help set right the property prices in Delhi.