Having witnessed the positive impact of metro rail connectivity on the real estate markets of Delhi, it has been a general perception that extension of the facility to any of the sites pushes prices of residential property to north. However, the NCR (National Capital Region) location of Noida narrates a different story.

The property prices in certain parts of Noida?planned to have metro link?have rather declined. Interestingly though the capital prices of residential real estate in some sectors of Noida have come down by 5-10 per cent in the past 3-months, the rental values have shot up amazingly at the same locations.

Now, you would wonder as to why the markets are behaving in this manner. The real estate professionals cite the reasons in their own way. "Construction activities under metro project adversely impact the traffic arrangements in and around the sites. Everyone wants easy and fast access to their properties. Naturally, if a property buyer wrangles through diversions and traffic jams to reach a property, he won't like to buy it on a given value," says MP Singh of Silver Estates. Definitely, the demand is slowing down for quite some time, he says.

The trends get corroborated by the intensive market research undertaken as well. Take sector 17, for instance. The average capital prices of residential plots reached down the levels of Rs 70,000-Rs 80,000 per square meter (psqm) in October from Rs 80,000-Rs 90,000 psqm prevalent in August. A staggering decline of about 12 per cent in 3-months!

Similarly the capital values of residential plots in sector 15 dipped by about 9-per cent in the period between August and October 2007. And yes, these are the sectors where infrastructure construction for the metro is underway.The trend is identical across the sectors of number 14, 14A, 15A, 17, 44 and others where the construction activities are going on.

The rental values, although, are rising quite sharply in these areas, and an appreciation between 5 and 15 per cent has been recorded in rentals per month. "Given the chaos created by metro construction, the primary reason behind rise in rental values is that property buyers are postponing their property purchases in Noida for now and preferring to hire," property consultants say.Meanwhile, industry veterans predict that the capital prices would stabilize or keep going south till 2009, when the first phase of metro project would complete; a year before Commonwealth Games 2010.