October 29, 2007

Land Prices

Up to 5 years ago it was possible to buy prime agricultural land (with a good water source) within a couple of kilometres of the Hill for under 2 Lakhs an acre. The main reason for this undervaluing of land was due to the fact that 'Tiruvannamalai' is classified as a 'backward area'. In this respect even now official Land Registry prices of both urban and agricultural land is priced very low.

Over the last years due to a variety of factors, land prices are experiencing a continuous and steep vertical rise. Land which cost Rs.100,000 an acre just five years ago is now selling for between Rs.12-15 Lakhs nowadays. (A Lakh is Rs.100,000)

Reasons for price rise:

1) Professional out-of-town brokers and speculators artificially inflating land prices.

2) Certain groups of financiers, such as Jains and Chettiars, buying land for investment purposes.

3) The District Collectorate moving to this area and thereby making Tiruvannamalai the District Headquarters.

4) Development and promotion of the area for tourist purposes by the Tiruvannamalai Municipality.

5) Increasing fame of Arunachala and the huge increase of new high income residents.

6) The attraction of New Age Gurus developing Ashrams at Tiruvannamalai.

For the above reasons, good land (with water supply) located within 3 kilometres of the base of Arunachala is priced at between 15 to 30 Lakhs an acre. Urban land for the purpose of individual house units costs anywhere from Rs.200-Rs.600 a square foot.

If the above prices are already too steep for some wishing to relocate to Tiruvannamalai, then one has to travel up to 12 kilometres from the base of Arunachala to start finding available land at pre-boom prices and where it is still possible to find tracts of agricultural land at under 3 Lakhs an acre. Land prices will NOT be going down in price and one doubts that land prices will plateau and stabilise for at least another 2-3 years. Prices will continue to go and stay up.

Indian readers of this Blog know only too well; that the exorbitant land and property prices in metropolitan/tourist areas like Chennai, Bangalore and Bombay, make parcels of land within City boundaries affordable ONLY to large Companies, Developers and Financiers. To the non-Indian readers of this Blog, who remembers with nostalgia the cheapness of prime land at Arunachala, be assured bargain basement days are over and you now have to pay SERIOUS money for what you want.

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