Consecration of the Ram Mandir: Is it the perfect moment to buy property in Ayodhya?

By Bricksnwall | 2024-01-22

Real estate experts predict that while land investments should yield good profits, there may also be a market for serviced apartments and fractional ownership of assets. In Ayodhya, the real estate market is booming, with prices for land rising four or even ten times more than four or five years ago, and the Ram Mandir's consecration ceremony is in just one day.

According to real estate specialists, the temple city's tourism potential and the market's limited organized real estate supply are the main factors driving demand. They note that the increasing trend will inevitably continue till new real estate stock is constructed in the ensuing year or two.

According to data from the UP Tourism Department, the city saw 3.25 lakh visitors in 2021, but 2.39 crore tourists and pilgrims flocked there in 2022?an increase of 85 times. It is apparently anticipated that the number will surpass 3.5 crore in 2023. According to reports, following the consecration event on January 22, the Uttar Pradesh government anticipates that at least one lakh pilgrims will likely visit the city each day.

The government has approved property for the construction of many townships and private hotels, which are anticipated to emerge in the city. These land lots are situated close to the Lucknow-Gorakhpur Highway, Ring Road, and Chaudah Kosi Parikrama.

Up until recently, the state government has established a few tent cities and given property to hotels. The first seven-star vegetarian hotel in India is reportedly set to open in Ayodhya, with a menu that is all vegetarian. Other well-known hotel companies, in addition to Radisson, Taj, and ITC, are allegedly taking Ayodhya into consideration for their growth plans. In the city, the Abhinandan Lodha Group also intends to build a high-end hotel.

Following the temple's opening, the Mumbai-based real estate developer House of Abhinandan Lodha (HOABL) intends to begin construction on a 25-acre projected development project in Ayodhya. The future temple is around fifteen minutes away from the project.

When the temple city's infrastructure is finished, visitors who would normally stay for a few days might decide to stay for a week, which will probably stimulate business and improve the local economy as a whole. According to experts, this implies that if additional shopping centers and other tourist destinations are built near the location, more visitors will want to stay there longer.

Demand is anticipated to be driven by elder living, managed vacation houses, and small housing units. 

"Over time, vacation rentals, assisted living facilities, and wellness centers might receive increased attention. It is possible to extend the pilgrimage period from two to seven days. In order to make money, some investors may choose to rent out the vacation houses that sprout up throughout the city, according to Ravi Shankar Singh, Managing Director of Colliers' Residential Transaction Services in India.

Having said that, these are anticipated to be modestly sized complexes, suitable for modest families that would double as a quick getaway or pilgrimage. Some people could choose to invest in housing developments that give them the option of hiring a third party to take care of the property and rent it out while they are away.

Pay attention to yielding rental revenue and return on investment.

Right present, return on investment is supposed to be the main concern for all investors.

In the long run, senior living may potentially emerge in this metropolis. For peace and quiet, senior citizens might prefer to go to the temple town. Although the emphasis would be on return on investment, NRIs might also wish to invest in real estate. They would like their asset to be monetized for the most of the year, even though they might only visit the location once or twice. They could like to invest in temple towns, but there needs to be room to generate rental revenue, according to Singh.

Is it wise to make investments in a place of worship like Ayodhya?

Certain zones have nearly unaffordable housing prices due to limited land availability and rising demand. Developers expect big prospects and big returns on investment in Ayodhya, where a number of townships and private hotels are planned.

According to Square Yards' principal partner and sales director Ravi Nirwal, investors can look at both residential and commercial projects in the neighborhood.

The cost of real estate in Ayodhya has increased five- to ten-fold since Ram Mandir's construction began. The cost of land and properties has increased in relation to the type of property and distance from the temple; within 5?10 km of the temple site, prices range from ?2000 per sqft to nearly ?20,000 per sqft. It is anticipated that prices will increase by 12?20 times over the following ten years due to the thousands of tourists that the temple city will receive after its debut, he said.

Possibility for Non-Resident Indians

"For Indians who are not residents, purchasing real estate in Indian religious tourism locations can be a smart alternative. Santhosh Kumar, Vice Chairman of ANAROCK Group, stated that they should consider the stability of the local real estate market, potential rental yields, resale value, and the long-term appreciation of real estate.

In the long run, fractional ownership arrangements might appear.

A group of persons who jointly own an asset is known as fractional ownership. Part of the asset is held by each owner, who also usually shares its benefits and liabilities. Any gains in an asset's value fall under this category.

The founder and CEO of Assetmonk, Prudhvi Reddy, believes that as tourism grows in this temple town, there will be a greater need for high-quality lodging.

Source - Hindustan Times