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Age of Indian Homebuyers – Across Decades and Cities

– by Prashant Thakur The age of property buyers is an important demographic variable which Indian real estate stakeholders from developers to marketers and advertisement agencies must focus on. Over the past decade, there has been a tectonic shift in not just the overall buying pattern but also in the age of property buyers. Until the late ’90s, many Indians preferred to buy homes using their savings rather than opting for home loans. As a result, most homebuyers were in the age group of 45-55 years or even closer to retirement – by then, they had accumulated sufficient wealth to support property purchase. In this period, younger Indians with much lower savings kept away and were also very cautious about bank loans, seeing them as risky. Also, many banks were reluctant to...

Ahmedabad has 52% of Housing Supply in Affordable Category

The residential real estate market in Gujarat’s top city Ahmedabad has been riding high on affordable housing projects over the last five years. A highly price-sensitive market, Ahmedabad is banking heavily on boosted demand for affordable homes. The government’s push for the affordable segment is another feather that gives it the much-needed impetus. No wonder more than half of the units launched from 2014 onwards catered to the budgeted segment priced <INR 40 lakh. Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants says, “According to ANAROCK research, as many as 1,30,650 units across different budget segments have been launched in the city since 2014 till H1 2019. Of this, nearly 52% (approx. 67,400 units) were in the affordable segment, followed by 37,400 units in the mid-...

Govt. Lifeline May Rescue Over 2.5 Lakh Stuck Housing Units in Top 7 Cities

–  by Anuj Puri Taking the first step in addressing the key issue of delayed housing projects across the country, the FM recently announced the setting-up of a special window of INR 10,000 crore for last-mile funding of distressed affordable and mid-segment homes. Approximately the same amount of funds will be added by outside investors such as LIC, etc. However, this comes with a caveat – the projects should not be non-performing assets or pending under NCLT and must be at least 60% complete. According to the latest research by ANAROCK, after considering these caveats, nearly 2.5 lakh units across the top 7 cities can avail relief from the government’s aid in the top 7 cities alone. However, since data for projects under NPAs is not available, there could be a further dip in t...

New Luxury Housing Supply Triples in 2 Years Since DeMo

by Anuj Puri Along with the resale homes market, luxury housing took the hardest hit after demonetization. The Government’s continued focus on affordable housing coupled with the surgical strike on high-value currency denominations in November 2016 took the sheen off luxury housing for two years in a row. As a result, developers restricted new supply in the luxury category across the top 7 cities. However, ANAROCK’s most recent research indicates that while the affordable and mid-segment housing sectors continued to dominate the overall supply in H1 2019, luxury and ultra-luxury housing also saw a resurgence. As many as 16,100 new units have been launched in the luxury segment priced >INR 1.5 Cr across the top 7 cities – massively up from 5,240 units in H1 2017. Effectively, new l...

Housing Absorption Declines 13% in Q2 2019 – ANAROCK

by Anuj Puri As anticipated, residential real estate activity remained largely tepid during the second quarter of 2019 in the backdrop of the general elections during the period but the recent Union Budget sops for the affordable sector may give the much-needed push to the segment henceforth. ANAROCK research indicates that housing sales in Q2 2019 fell by 13% q-o-q and stood at 68,600 units across the top 7 cities. New launches saw a 2% quarterly decline and stood at 69,000 units. Four of the top 7 cities – NCR, Bangalore, Chennai, and Kolkata – saw increased new launches. Though by a minuscule margin, it was the first time since 2016 that new launch numbers outstripped housing sales in a given quarter. Ideally, it should be vice versa. Hyderabad, Bangalore, and Pune saw the m...

Anuj Puri Launches B2C Residential Brokerage TRESPECT

After launching the highly-successful ANAROCK real estate services group in 2017, industry stalwart Anuj Puri today announced the launch of TRESPECT, a pan India ‘open market’ B2C residential real estate broking firm. It will be headed by real estate and consumer marketing veteran Sunil Mishra, who has 24 years’ experience in a business building within the real estate, telecom, BFSI, and online start-ups domains. Prior to this appointment, Sunil Mishra was COO of IL&FS Township & Urban Assets Ltd., Chief Business Officer at online property brokerage PropTiger.com, and CEO at Karvy Private Wealth. He also held leadership positions at KPMG Consulting, WorldTel UK and Bharti Airtel. With a strong sales and marketing background, he is also specialized in private equity mana...

Cloud Kitchens – F&B Sector Cooks up a New Recipe to Beat High Rental Costs

by Anuj Kejriwal High real estate costs have already kick-started concepts like coworking and co-living in the office and residential spaces. It was just a matter of time before the F&B sector came up with its own real estate cost-saving recipe. Real estate rentals have risen significantly in major cities like MMR on the back of the increasing shortage of quality supply. This factor alone often leads to thousands of restaurants across Indian metros shutting shop each year. Rentals in some prime locations in Mumbai can ‘consume’ 25-30% of a restauranteur’s total monthly revenue. This profit-devouring range is significant if we consider the average global trend of 15-20%. It holds true for many non-prime areas of cities like Mumbai as well. However, prime locations are obviou...

ANAROCK Partners with Aldar to Market Its Abu Dhabi Properties in India

The ANAROCK Group, India’s leading specialised real estate services firm, has partnered with Aldar Properties PJSC (‘Aldar’), Abu Dhabi’s leading property development, management and investment company, to market some of Abu Dhabi’s most sought-after properties to Indian investors and buyers. The partnership will provide Indian investors with direct access to Aldar’s portfolio of world-class destinations across Abu Dhabi. This includes: Mamsha Al Saadiyat, located on the beach adjacent to the capital’s iconic cultural district home to the Louvre Abu Dhabi, the much-anticipated Zayed National Museum, and the Guggenheim Yas Island developments such as Mayan, Yas Acres, and Water’s Edge (all close to Ferrari World and Warner Bros World) and Algh...

GST Council Meet – Real Estate’s Hopes Vs Reality

by Anuj Puri The real estate sector is obviously not without its own hopes from the first GST Council meeting of Modi 2.0. Reducing the GST rate for cement from the current 28% slab to 18% had been a long-standing demand of industry stakeholders. That said, while the announcement of such a reduction would certainly help developers, the ‘real’ question is whether homebuyers would benefit. This depends on whether the benefits of the reduced cost of raw materials is actually passed on to the consumers. It brings to mind a similar question related to home loan rates vis-a-vis RBI’s announcement of repo rate reductions. The actual transmission of such reductions to home loan borrowers has been minimal, even though the RBI lowered its repo rates three consecutive times. The hop...

Real Estate Budget Wish List: More Tax Benefits Needed To Generate Demand

by Anuj Puri With the Modi Government taking full charge, all sectors have pinned high hopes from the finance minister – who is already saddled with multiple issues including the slowing economy, liquidity crunch due to NBFC crisis, lack of job creation and rising NPAs, among others. Without compromising on fiscal prudence, the Finance Ministry will have to present a budget that is not only inclusive but also assures growth across industries. It clearly shoulders a considerable share of responsibility for retaining India’s position as the fastest-growing economy. Since real estate is one of the major contributors to the GDP growth and can help the government resolve the shortfall in job creation quite a bit, it is naturally expected that the upcoming budget will help the industry. Be...

Is Indian Real Estate Still a Profitable Investment Asset Class?

by Anuj Puri, Chairman – ANAROCK Property Consultants Let’s get straight into this question, which has been a concern among all stakeholders – financial planners, property owners, investors and prospective buyers – over the last few years. And only because real estate, particularly residential, did not yield the same returns as it did during its Golden Era of the early 2000s. Past trends reveal that between 2013 to 2018, residential property price appreciation in India bottomed out to a mere 12% – effectively a little over 2% on a yearly basis, even for properties in prime locations. So, if one bought and sold such property within this period, their returns would have been less than satisfactory. After all, during the boom era between 2004 and 2008, the average five-year return...

Can South-Central Mumbai Handle its Luxury Oversupply?

 Anuj Puri, Chairman – ANAROCK Property Consultants Luxury housing in South-central Mumbai is rarely out of the news. Mumbai’s legendary playing ground of Bollywood celebrities and high-flying business tycoons has been a constant magnet for HNIs and UHNIs from both within the city and beyond, and everyone from start-up founders to C-Suite professionals has an inherent yen to live here. It has a total unsold inventory of approx. 11,000 units as on Q1 2019 Substantial unsold stock is of large-sized properties with lower demand Multiple options have increased the gestation cycle for luxury projects sales Ticket sizes in south-central Mumbai go to over INR 80 crore; INR 15 crore in other tony areas While the demand for luxury homes in South-central Mumbai is beyond dispute and its real e...

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