Surprise Surge in Kerala's Real Estate Market Amidst West Asian War; Why?

Due to the conflicts in Gulf countries, expatriates are turning toward housing projects in Kerala as a safe investment. There is a rising demand for mid-range homes and branded apartments.

The echoes of the escalating conflict in West Asia have begun to reflect in Kerala's real estate market as well. Reports indicate a significant surge in inquiries for new homes from expatriates in the Gulf to construction companies in the state.

Leading Kochi-based real estate firms assess that over the past few weeks, there has been an increasing demand for housing projects targeting the mid-income housing segment.

Why is Demand Rising?

In the wake of the intensifying war in West Asia, construction companies observe a sudden surge in demand within Kerala's property market. This is attributed to expatriates prioritizing long-term investments for economic security and future housing needs. The majority of inquiries are coming from non-resident Malayalis living in Gulf countries, primarily Kuwait, Bahrain, and Oman.

Inquiry Extends to Smaller Towns

Most inquiries from Gulf expatriates are concentrated in the state's major cities like Kochi and Thiruvananthapuram. However, emerging suburban areas are also gaining equal importance among investors. In Kochi, there is a high demand for housing projects in areas like Marine Drive and Kakkanad. In Thiruvananthapuram, the demand is highest in the Kazhakoottam area. Similarly, inquiries for housing projects are also reaching smaller towns like Thodupuzha and Perinthalmanna.

 Priority for Branded Apartments

Despite a visible increase in demand within the Kerala real estate market following the start of the war in West Asia, construction companies have not yet moved toward launching a large number of new projects. Non-resident Indians (NRIs) are currently showing a higher preference for land investments rather than under-construction or completed building complexes in Tier-2 cities.

At the same time, due to the war in West Asia, the price of raw materials has increased, leading to a 15-20% rise in construction costs already. This market price hike has brought a noticeable change in the approach of consumers. Real estate experts indicate that instead of building houses on their own, investors are now shifting toward choosing branded apartments from prominent builders.