No matter what the context may be, infrastructural development is always appreciated as it signifies positive growth in an economy. The importance of infrastructure in real estate must be acknowledged, as it leads to an increase in investments, trade and generation of employment. Infrastructure projects such as roads, metro projects and flyovers are crucial in connecting different regions, facilitating the movement of traffic and goods.
In real estate, infrastructure can be classified into two types, physical (roads, highways, flyovers, public transport, etc.) and social (schools, healthcare facilities, banks, shopping complexes, lighting systems). There are many ways in which infrastructure can influence the development of real estate. Some of these are:
1. Improved accessibility
When a new expressway or road system is built in a location, developing real estate in that area, both commercial and residential, will be highly beneficial for developers. They will be able to get higher prices due to better accessibility/ connectivity. Property located near a good transport system will also appreciate in value over time, therefore it will be a good investment in the long run.
2. Urban development
When better schools, colleges, hospitals and shopping malls are built in an area, then the property or real estate in that area increases in demand. That is because people always want to have their offices/ homes in areas with improved amenities.
3. Metro Rail/ Public Transport Facilities
Mirpur is probably the best example of this. After the metro rail stations were built in areas like Pallabi and Mirpur 10 & 11, the demand for property in these areas increased exponentially. Similarly, if a new bus stop is built in an area, real estate development in that area will become more expensive – developers will simultaneously be able to charge more for apartments and office spaces.
4. Development of economic zones
When the Savar EPZ was opened, vacant land in surrounding areas started to be sold like hotcakes. This is because an EPZ will require low-cost housing facilities nearby, a chance that many real estate developers will grab at the blink of an eye. Other necessary infrastructure like schools & hospitals will also eventually develop in the area.
Keeping track of current market trends and infrastructural developments will allow you, the buyer, to make a well-informed decision on real estate investment. Depending on whether you want to make a short or long-term investment, and on the ROI of real estate in your chosen location, infrastructural development can aid your decision by manifold.