No doubt that the prices of residential property of Kolkata is almost all the micro market of eastern city northwards, yet uncertainty looms large in Kolkata realty.

There’s been less transaction and even lesser new residential launches in Kolkata even when the state chapter of the Confederation of Real Estate Developers’ Association of India (CREDAI) demands ten satellite towns in the state. Real Estate projects have been on a standstill as the developers are apprehensive of the policy of the Government post the change of power after 34 long years.

Kolkata has witnessed fewer number of residential property launches as compared to last year due to delay in approvals and clearances.

Managing Director of Sureka Group and President of the Kolkata Chapter of CREDAI Mr. Pradeep Sureka says, the new supply in residential property of Kolkata has been significantly low as before the elections approvals has stalled and even now they are very slow. Like many other developers in Kolkata Sureka is awaiting Government approval for his next set of launches once they know the kind of land that they can purchase and their probable locations they can go ahead with their residential property in Kolkata. On an average they are looking for 500-1000 acre of non-agricultural land for housing development. Of course if they are to directly buy land, then Urban Land Ceiling Act has to be removed as pointed out by Sureka.

Developers are also lobbying with State Government for incentives to recover cost overruns. Three critical factors that will determine the Kolkata realty choice ahead are land availability, ease of connectivity and infrastructure readiness. The Urban Development Minister Firhad Hakim says the new Government required some time to analyse the sector when acknowledging the need of fast-track housing development in the state.

As the data of Jones Lang LaSalle India (JLLI) only 4600 apartments have been launched by October 2011 as compared to 8900 in 2012. In second quarter of 2011 the real estate market witnessed the launch of four residential property in Kolkata offering 711 new residential units which includes the costliest property as well. Though project launches have been few but the realty market unlike other parts of the country has witnessed a jump in prices by almost 15-20%.

Managing Director of JLLI, Kolkata Mr. Mayank Saxena says, in post 2009 developers in Kolkata mainly focussed on sub Rs. 20 Lakh homes but now a days everyone is building bigger residential property in Kolkata where the prices have increased substantially.

Mr. Rahul Todi, Managing Director of Shrachi Realty, part of the 800 Shrachi Group says, the prices have appreciated in Kolkata center by 15-20%. Residential property prices haven’t increased in any other city but the prices have largely been driven due to demand-supply disparity in the city. This year 5-10 significant projects have been launched and they expect the situation to continue like this next few months.

Meantime, the property analysts believe the IT/ITES sector will continue to lead the demand for office space followed by Pharma and financial firms, Telecom sector, Industrial growth might spur office space demand from the manufacturing and engineering sectors.

Kolkata developers expect the price to remain stable as rate hikes and unsold inventories will dominate the real estate market in 2012. As today the property consultants says, the real estate prices in Kolkata have begun to steady fast. The second half of the current fiscal (2011) has seen many more sales and bookings compared with the first six months as Executive Director of Cushman and Wakefield, Mr. Kaustuv Roy said, developers are probably betting on that the prices of property in Kolkata will remain firm for next two-three years by which time most of these residential projects would be ready for possession.

Liases Foras, a real estate rating and research firm says, the Kolkata residential market has 15,300 unsold units of which 42% inventory hails from Rajarhat and 17% each from northern and western Kolkata. This research has been done across 66 locations in Kolkata and its suburbs including the Hoogly and Barasat.

Mr. Pankaj Kapoor, Managing Director of Liases Foras, says, Kolkata property market is the smallest in size as compared to other metro markets and the market is sluggish at the moment though rest of the city has very less unsold inventories but Rajarhat dominates the chart.

Real Estate market of Kolkata is still in very nascent stage but prices have started to escalate and both Unitech and DLF have residential projects in Kolkata city are reporting healthy sales for its launches projects. The information technology (IT) service sector hasn’t recovered completely, Rajarhat is witnessing more vacant than other parts of the city like Ballygaunje or Alipore is the hotspots for residential realty projects at present.