What is real estate?
Real Estate Market in IndiaPresented by Gurvinder Singh Real
EstateReal estate is the land and the changes that are done to
land.Recognized as infrastructure service.Fast growing market in
the worldLarge population baseRising income levelRapid
urbanizationIt is second largest employer after agriculture.
SectorsResidential space (Housing) Affordable Housing Mid-Income
HousingLuxury HousingCommercialRetailHospitality
Drivers of Real Estate SectorEconomic performanceRising Income
LevelYounger and smaller families.Rising Urbanization
(Migration)Annually 10 million people migrate
Growth Country's population lived in towns in 1951 was 17%,
currently32% and by 2050 about 50% . This indicate huge demand for
Affordable houses.Market size is expected to touch US$ 180 billion
by 2020 and in 2011 US$ 66.8 billion.Study by Knight Frank, Mumbai
is the best city in India for commercial real estate investment,
with returns of 12-19 per cent.Attracting investments in Mumbai.
Andheri West and East remain favourite addresses in Central Mumbai.
Ghodbunder Road in Thane. Airoli and Kharghar in Navi Mumbai are
top choices for working couples and nuclear families.
Government InitiativesSardar Patel National Urban Housing
Mission (Housing for all)- 30 million houses, 2022Relaxed FDI
normProposed to release Real Estate (Development and regulation)
billProtect consumer interest Standardization in business
practiceLand acquisition Resettlement & Rehabilitation Act
2013Reduction in the size of projects eligible for FDI from 50,000
sqm to 20,000 sqm and minimum investment limit.
OTHERSoftening of repo rate- It has positive impact on both
developer and consumers.
Budget 15-16The budget is low on big bang reforms and real
estate is only an indirect beneficiary. REITsVisa on ArrivalGST
Wealth Tax Single window clearance system for speedy approvals
Intends to build 2 crore houses in rural and 4 crore in urban
India.Increase in service tax will increase the cost of
construction.Challenges Lack of clear land titleLack of adequate
source of financeDifficulties in Approvals and Procedural :24
regulatory processes for obtaining construction permit. It takes an
avg 227 daysLack of basic infrastructure in Indian citiesSupply of
urban land is largely controlled by the Government Development
bodies Leaving very limited developed space, which is controlled by
a few major players in each city.
Why Houses are not affordableIn India cities like Mumbai, the
cost of land contributes more than 70% of the total cost, even in
tier two and three cities, it contributes almost 50% of the cost.
When compared to developed economies, the land cost contributes not
more than 30% to the total cost.
Need for ConsultancyConsultant brings years of marketing
experience, knowledge.Win-win situation Sell the home faster,They
knows about Builder Reputation, Loan Facility, Area calculations
like carpet area, Built up area, Super built up area etc.Name of
companiesHDFC REDNetwork Consulting
ConclusionUrbanization is a trendPrice stagnation will continue
for short-termExisting unsold stock2015 will focus more on recovery
and clearing inventory.
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