Tag Archives: Indian diaspora

NRI investment pattern changing in real estate

Posted on by Track2Realty
Track2Realty Exclusive

Bottom Line: NRI homebuyers are getting more and more realistic in the housing market of India.

NRI, Non Resident Indians, Indian Diaspora, PIO,  Persons of Indian Origin, NRI investment in India, NRI investment in real estate, NRI investment in property market, NRI investment pattern, Where are NRIs investing, India real estate news, Real estate news India, Indian realty news, Indian property market, Track2Realty, Track2Media Research When Alka Rajpurohit, an NRI from Dubai told the local property agent in Delhi-NCR that she would like to sell their luxury apartment in Gurgaon and instead wants to buy a premium apartment in Noida, the broker was surprised. However, this has not been first such request and the broker soon realized that the market dynamics of NRI investment into the Indian property is changing.

From NRI investors and speculators to future end user buyers, the NRI investment pattern has taken a tectonic shift. Moreover, no one is nowadays investing into ultra luxury property or saturated locations. Mid-segment apartment in relatively affordable markets are very much in demand.

Take the case of Arjun Parihar, an NRI from Boston who is now returning to India and has already invested in a mid-segment apartment in Ghaziabad. Though a native of Ghaziabad, his choice is governed by the economic fundamentals than nostalgia of home city.

“People think we make lots of disposable money, but life is not that easy for us in foreign countries. And if I invest in a plush luxurious apartment, then my finances will not allow me to start my business here. What will I do with luxury apartment but no source of livelihood,” says Parihar.

NRI realities

95% NRIs are employees & wage earners and can’t afford luxury property in India

Rich NRIs have burnt their fingers or learnt with experience of peer group to avoid luxury

Small ticket investment gives better exit option & rental returns

Job insecurity globally forcing NRIs to be realistic in housing investment back home

As per the data available with Track2Realty, the Malayalese and other South Indian NRIs are nowadays investing into Kochi and Coimbatore than Bangalore or Chennai. Gujarati NRIs are investing into Ahmedabad and Vadodara than Mumbai. Mumbai-born NRIs are investing into Pune and Nashik than Mumbai. North Indian NRIs are investing into Noida and Ghaziabad than Gurgaon. One common thread into all these investments is scaling down of property segment – from ultra luxury to mid-segment and premium housing.

Kaizad Hateria, Brand Custodian & Chief Customer Delight Officer, Rustomjee Group agrees that nowadays in majority of the cases the clients who buy luxury and super luxury properties are end users. Every end user does not have budget to invest in luxury or super luxury property developments.

“Self employed segment of NRIs are more focused to have investment portfolio of different projects instead of putting money in large size developments. They plan to divide their money among various small ticket size projects where they can sell easily if they want to or they can fetch good amount of rentals from various investments done,” says Hateria.

Manju Yagnik, Vice Chairperson, Nahar Group points out that there has been a trend among the NRI community to invest in the Rs. 60 lakh to Rs. 2 crore in properties depending on their social strata, as this looks to be an attractive and safer option to invest. Most of the affordable luxury housing projects are found in this price bracket in metro cities like Mumbai with high appreciation in long run. Currently the NRIs prefer not to take a risk by investing in super high-ticket size projects, as market is not as buoyant in this segment.

“NRIs also like to keep the option of exiting open based on the movement of the global economy. A project with large ticket size comparatively takes longer time to liquidate, if required in future. NRIs over the years have been investing in property, but mainly across metro cities of the country as it ensure them the lifestyle they are used to and appreciation value and healthy returns,” says Yagnik.

Does it mean that the luxury and ultra luxury properties will no longer attract the NRIs? The opinion is divided among the analysts but everyone would like to agree that the days of speculation driven investment is over. Many of the NRIs who had invested into some of the most luxurious properties in Gurgaon, Mumbai or Bangalore are today stuck up.

Contrary to the myth, all the NRIs are not necessarily rolling into big money. The fact of the matter is that 95 per cent of the NRIs are employees and wage earners.

A survey conducted by Pravasi Bandhu Welfare Trust, a Dubai-based non-governmental organisation working for bettering the lives of Indian workers in GCC countries, finds that a whopping 95 per cent of NRIs in the Gulf do not save anything and return empty handed to India even after working for a decade. Only 5 per cent of the Indian labour force including the white collared manages to have some decent saving.

The study finds that only 10 per cent of Indian workers in GCC nations live with families, a majority of them fail to save sufficient money due to low wages and high cost of living.

Obviously, all NRIs are not super rich, and those who are have either burnt their fingers with ultra luxury or have learnt from the mistakes of their peer group. And hence, the NRI housing demand nowadays reflect the grounded realism; something that augurs well for the housing market as well since the speculative NRI buying is over and end-user market is fast evolving. 

By: Ravi Sinha

Mumbai property on top of NRI’s wish list

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Track2Realty Exclusive

News Point: The demographic profile of the Non Resident Indians (NRIs) may not do justice to conclude why Mumbai is always on top of the wish list of the expat Indians.

NRI, Non Resident Indian, Indian Diaspora, NRI investment in property, Property market for NRIs, India real estate news, Indian property market, Track2Realty, Track2Media, Indian Diaspora investmentThe major demographic profile of the NRIs is from the states of Gujarat, Kerala, Punjab and other parts of North and South India. Going by what the traditional investment pattern of the Indians, the cities that should draw the maximum NRI investment should be Kochi, Ahmedabad and Chandigarh. But then it is the Mumbai city that has over the years commanded the maximum premium from the NRIs.

The slowdown of the Indian economy and the resultant effect on the property pyramid where the high-end investors started scaling down their portfolio size gave the impression that the NRIs who were fuelling the luxury property of Mumbai would be skeptical with the dream city. However, this proved to be an outside view as the NRIs who have travelled in developed cities of the world still find opportunity cost of Mumbai pretty high. In their cost & benefit analysis, Mumbai continues to be an investment magnet.

Critics who pointed out that the NRIs are exiting the luxury properties probably failed to differentiate between the NRI investors and the NRI end users. It is true that the investors are wary of ultra luxury projects across the country and Mumbai is no exception. But equally true is the fact that the kind of business opportunities, lifestyle and livability index that the NRIs looking to settle down in India want, no other city can match their aspiration level as Mumbai.

Mumbai magnet for NRIs

Mumbai a top pick among the NRIs professionals; retirees prefer hometown

 Mumbai still offers the maximum ROI on property investment

No other city offers the NRIs quality of life and business opportunities like Mumbai

Connectivity of Mumbai with other global cities act as a magnet for NRIs

Satish Dwivedi, and NRI from Western Uttar Pradesh now working in Yemen is coming back to India. The financial consultant was advised by the broker that Noida is a better option for settling down in India and exploring his business. The ticket size of the Noida market is not even 30 per cent of the Mumbai real estate and hence the advice prima facie looked very convincing. In terms of the cost of doing business per square feet, Noida was peanuts compared to Mumbai.

“With the impression that I was given I was pretty much convinced in favour of Noida since it is very close to my home town in Moradabad. The physical infrastructure of the place also is far superior. But then I soon realized that it could only be my retirement destination. In terms of conducting my professional and social life, no city can match Mumbai,” says Dwivedi.

The built environment of Mumbai real estate that deals with the NRI buyers do understand this wish list of the expat Indians. “The first consideration for any home-buyer is how will he conduct his professional life. Then after he has to look for conducting for social life. Then comes the question of budget and affordability which is very relative. For the NRIs since there is no budget constraint like an average salaried class in India, they would go for a city where they get the lifestyle choices along with professional opportunities,” says Arvind Nandan, Director – South Asia with Colliers International.

Ravi Gurav, Member of MCHI points out that Mumbai real estate market has been getting some good support from NRI sales since the last two years. The share of enquiries by NRIs on real estate portals are over 30 per cent in today’s times. Whereas the local buyers are still considering the property prices as high, at the same time NRIs are buying the best deals available from Mumbai market. From the month of August 2016 we are witnessing a lot of new launches along with existing launched properties offering better deals with relaxed payment schedule or free biz such as furniture and home appliances.

“NRIs are especially bullish in Mumbai real estate market due to two reasons. First is that they understand the gradual correction that taken place in Mumbai real estate market. Even if we consider the inflation from 2013 to 2016 at the rate of 5 per cent per annum then overall inflation is 15 per cent in last three years. But if we get the property in 2016 at the price of 2013 means it is at 15 per cent correction. Secondly, Indian Rupees against US Dollar depreciated almost 20 per cent from 2013 to 2016. The Indian Rupee against US Dollar was 55 in April 2013 where as in April 2016 India Rupee was 66 against US Dollar. Which is like the 20 per cent depreciation of Indian Rupee against US Dollar,” says Ravi.

As per this calculation, if we consider the consolidated effect of 15 per cent gradual correction and appreciation of US Dollar up to 20 per cent in last three years, it is as good as Mumbai real estate market poised at 35 per cent corrected price for NRIs and hence they are bullish.

Devang Trivedi, Managing Director of Progresive Group finds a sound financial rationale in the Mumbai property investment of NRIs. He points to the fact that the NRIs are used to low returns on investment in their country. So, in Mumbai rental income is equal to the appreciation in their country and whatever appreciation in property price rise they are getting is a bonus. Moreover, they have a long term option of returning to Mumbai  and have a self use option.

“Among all the different investment classes that is gold, silver, diamond & stock market, property investment is the most tangible & common sensible investment. Long term perspective in Mumbai remains a safe market because of limited supply  and ever increasing population. Ten times growth in Mumbai between 2003 and 2008 is giving encouragement to all the NRIs to invest in Mumbai, as back in their own country the property is the same with only 2 to 5 percent maximum growth,” says Trivedi.

Beyond all the cost & benefit analysis, the fact lies that Mumbai still offers the high livability index and the reasonable cost of doing business to NRIs. So, any NRI who is returning back to the country and wants to continue the professional life prefers Mumbai for investment. Despite the slowdown of the last few years, which has hit the property markets across the country, everyone understands that in terms of the ROI no city can match Mumbai. Add to it, the quality of life and the business opportunities, and Mumbai acts as a magnet to the NRIs. Last, but not the least, the kind of connectivity that Mumbai offers to all the major international cities is a magnet for NRI professionals returning back to India to set up business here.

By: Ravi Sinha

Piramal Realty launches Phase II of Piramal Vaikunth

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News Point: The second phase of development at will launch two residential towers: Vahin & Vrisa. 

Piramal Vaikunth, Piramal Realty, Mumbai real estate, Luxury property in Thane, India real estate news, Indian property news, Real estate news magazine, Indian Diaspora, NRI investment, New house launch, Track2Realty has launched 170 apartments at its residential towers Vahin at Rs 9040 per square feet and Vrisa at Rs. 9280 per square feet as part of Phase II of Piramal Vaikunth. This price is limited to the first 40 units only. Bookings commence from June 18, 2016.

The 2-BHK and 3-BHK apartments on offer range from a carpet area of 908 square feet to 1262 square feet. Each residence is fully air-conditioned, offering quality marble flooring in the living-room and bedroom, and private balconies. Both towers are positioned directly in front of the clubhouse and offer panoramic views of Thane creek.

Commenting on the launch Anand Piramal, Executive Director, Piramal Group said, “Piramal Realty aspires to be the most quality conscious and the customer-centric real estate company in India. There is a dearth of quality development in the city, and we have seen that there is a lot of potential for a high quality product. This is reflected in the overwhelming response we received for Phase 1 of Piramal Vaikunth, where we attracted buyers from South Mumbai, Western & Eastern Suburbs of the city as well as international markets such as USA, Singapore, London and Middle East.  Today, we have pre-launched Phase 2 of the project with two towers, Vahin and Vrisa, and look forward to receiving a positive response to our premium offerings.”

Piramal Vaikunth is a residential complex spread over 32 acres, featuring high-rises, townhouses and world-class facilities. The development intends to provide residents with a temple, a retail boulevard, a community center, multi-purpose badminton and basketball courts, squash courts, swimming pools, mini cricket ground, state-of-art gymnasium, day care & crèche, cafes & restaurants, convenience stores, guest suites & banquet halls, etc.

Housing.com launches ‘Privilege Price Card’

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News Point: This unique product offers home buyers the best deals in properties across India.

Housing Privileged Card, Housing.com PPC, Housing.com, Online real estate brokerage, India real estate news, India proper market news, NRI Investment, Indian Diaspora, Track2Realty has launched the ‘Privilege Price Card’ (PPC) for homebuyers to give access to exclusive deals and offers on properties across India.

The PPC will be first launched in Pune. For the launch, Housing.com has partnered with over 10 leading Developers – B U Bhandari Landmarks, Kumar Properties, Pride Group, Goel Ganga Developments, Mittal Brothers, Naiknavare, Nirman Developers, Kool Homes among others; offering special deals on more than 25 New Projects across the best localities of Pune applicable only for Housing.com Privilege Price Card customers.

Commenting on the launch, Nikhil Rungta, Chief Marketing Officer, Housing.com, said, “Buying a home is one of the most important decisions and at Housing.com we are constantly trying to help buyers take this decision in a stress-free and convenient way. Keeping in line with this endeavour we are happy to launch the ‘Privilege Price Card’ which will help buyers get access to some of the best deals and special prices on properties across India and enable them to buy their dream home. We believe that the PPC has the potential to transform the way homes will be bought and sold in India, both, for homebuyers and developers. We are overwhelmed by the response from the developers, and will soon be launching the product across the country.”

According to Housing spokesperson, Pune is an ideal launch platform for the ‘Privilege Price Card’, as it is one of the fastest growing markets for real estate in India and has several new projects in upcoming localities. It is attracting investors and buyers not only from India but even NRIs living in US, UK and Middle East.

2015 in review and gazing into 2016

Posted on by Track2Realty

By: Anuj Puri, Chairman and Country Head at JLL India

2016, New Year, NRI investment, NRI property, Indian diaspora, Indian real estate news, Indian property market, India real estate newsmagazine, Track2Media Research, Track2Realty, Property market forecastToday, the world sees India as a land of opportunity for business and investment. RBI head Raghuram Rajan said in mid-September that while fellow BRICs have deep problems, India appears to be an island of relative calm in an ocean of turmoil.

This scenario continues; as per recent government data, economic growth reached 7.4% in the second quarter of the current financial year, riding on a spike in manufacturing and a pickup in investment demand.

Globally positioning India as an investment destination and improving India’s diplomatic and trade relation, Prime Minister Narendra Modi’s foreign jaunts have helped India attract more FDI.

From the nations he visited during the financial year 2014-15, India received FDI of USD 19.78 billion. Moreover, foreign direct investment (FDI) in India increased by 27% in 2014-15 to USD 30.93 billion.

In other fronts as well, it is time to retrospect on how 2015 was for the real estate sector, and to crystal-gaze into 2016.

Commercial real estate

India’s office space absorption during 2015 stood at 35 million sq ft – the second-highest figure in the country’s history after 2011. The demand for office space in 2011 came from occupiers taking advantage of low rents after the global financial crisis. This time, however, it was the result of corporates implementing their growth plans.

While pan-India vacancy still stands at 16%, realistic vacancy actually stands around 8-9% – the total vacant supply is not always relevant for corporate occupiers. This is because most of them do not consider Grade-A buildings that are strata-sold or located in areas with inherent disadvantages and connectivity issues, or have been vacated from recent occupier exits and no longer match Grade-A requirements.

Cities such as Pune, Bangalore, Hyderabad and Chennai have a vacancy rate of just 5-10%, prompting the need for fresh supply to meet growing demand. Developers have been shying away from commercial projects because, though land and construction costs have been rising, rents have not reached a point where developers can get about 20% IRR. However, as rents climb faster, developers will start constructing – at least in the good markets.

Rents rose across Indian cities in 2015. The pace was faster in the secondary business districts (SBDs) and certain peripheral business districts (PBDs) of tier-I cities than in the established central business districts (CBDs). The micro-markets seeing more leasing activity in different cities in 2015 will continue to see action in 2016, while lesser-preferred locations will see a higher vacancy rate. As and when supply dries up and vacancy drops further, occupiers will start taking up spaces in these locations, as well.

In 2015, office space demand was mainly driven by IT/ ITeS, e-commerce, start-ups and large consulting firms. Players in many other sectors like FMCG, BFSI (front office), manufacturing, telecom and pharma did not come into the market – however, this should happen in 2016 and 2017.

Next year will also see demand for built-to-suit (BTS) properties, especially from the larger IT occupiers. While the absorption in 2015 is similar to 2011, it is distributed across new and old buildings; previously, it was largely in newly completed buildings.

Demand will remain consistent over most of 2016, with occupiers showing a positive bias. Given the low supply and continued demand for commercial spaces, corporate occupiers will continue to firm up their expansion plans. While 2016 will bring continued demand for leased spaces, quality supply will be lower. This means that unmet demand will reflect in higher occupancy of Grade-B office spaces.

After the opening up of real estate sector to FDI, the profile of developers, as well as ownership patterns, will start changing. This will lead to a drop of ownership requirements by Indian developers and a rise in ownership by PE funds and MNC developers.

Real estate capital markets

2015 has been an interesting year for capital market activities in real estate. While the PE focus continued to remain high on residential and office projects, entity-level investments and platform-level deals also came into the limelight, indicating increase in investor confidence.

In terms of asset focus, residential projects attracted a considerable share of funding; however, equity investment in this space is still insignificant. Income-yielding office projects attracted a majority of equity investments. In terms of the geographical spread, focus was restricted to tier-I cities with NCR, Mumbai and Bangalore attracting a majority of investments (73%); reflecting learnings from past experience.

While residential and office will continue to attract a majority of investments in 2016, retail is expected to start seeing better traction. Investors will remain focused on the top seven cities. Over the past few months, we have already seen interest from Chinese and Japanese investors to bring long-term money to India next year.

Overall, the stage is set for a superlative show next year. In fact, 2016 may well bring the kind of investment activities that were seen in 2007 – the previous peak year which saw investments of more than USD 8 billion into Indian real estate.

Residential real estate

2015 did not bring the hoped-for growth in residential real estate. However, the silver lining is that the bad days seem to have bottomed out; sales have picked up in a few cities like Mumbai, Hyderabad and Bangalore.

Launches have reduced in cities like Mumbai, slightly lowering the inventory. Developers’ initiatives like offering attractive schemes and deal terms, coupled with lowering of interest rates by the Reserve Bank of India (RBI), have activated fence-sitters.

The challenges of demand-supply mismatch and high unsold inventory across the country remain, but the signs are nevertheless encouraging – cities like Mumbai, Bangalore, Pune and Hyderabad are slowly but surely crawling back to positive growth. 2016 may well bring an end to the long and painful journey this sector has had, and signal an upward growth trajectory. It will definitely mature further into an organised industry in which some lesser-organised players become casualties.

Retail real estate

The year 2015 saw hardly any quality retail space come in. Apart from that, the two big trends observed were:

1.     Consolidation of retail real estate by brands and retailers who focused on their profit-making stores and closed down loss-making ones, and

2.     The entry of institutional investors. Thanks to relaxation of sourcing norms, single-brand retail companies will find more reason to explore the Indian market and also be able to undertake e-commerce business independently.

In 2016, more mature investors will come in and buy built-up retail spaces. Once they have the relevant experience and foothold in India, they will start investing in ‘greenfield’ assets. Retailers are maturing as competition heats with the entry of bigger brands into the country.

Stronger players will successfully attract private equity (PE) investments over the coming years. PE may also go into select mall investments, especially in under-represented markets or for mature assets’ buyout.

Quality mall space is coming up with strong pre-commitments, indicating that retailers remain bullish about India’s long-term consumption story. Retailers will start experimenting with formats and sizes for the same brands, adapting to markets as they start moving up the value chain.

2015 saw food and beverage (F&B) emerge as a strong category, and this will continue in 2016. Entertainment options will also improve, and technology-led retail will start entering in the single-brand retail store category.

However, 2016 will see a continued dearth of quality retail spaces. Retailers will have to revisit their real estate strategy and have a flexible approach, customised to different micro-markets. Investments by both home-grown and international brands will strengthen in tier-II and tier-III markets as they expand beyond tier-I cities.

Industrial & warehousing

2015 saw the wheels in motion for the industrial / manufacturing sector to get seriously rolling in 2016. Under the ‘Make in India’ programme, states can come up with advanced policies, which will help them fuel their industrial growth.

Maharashtra, Gujarat and Andhra Pradesh have historically been front-runners in attracting industrial investments. Under the ‘Make in India’ initiative, states like Punjab, Haryana and Karnataka are also taking bold steps towards better industrial policies. Online, time-bound approvals are expected to further improve the ease of doing business in India.

The warehousing sector is reaching an inflection point and will take a huge leap forward once the goods and services tax (GST) is rolled out next year. Apart from GST, e-commerce is expected to significantly drive the demand for warehouses in India in the near future. With nearly 25% of all warehousing absorption being driven by e-commerce players, it is currently the biggest demand driver for the sector. This industry is expected to invest an additional USD 2-3 billion into warehousing over the next 2-3 years.

Indian warehousing is seeing a higher supply of organised Grade-A and B warehouses than in the past. In 2015, the cumulative warehousing supply (Grade-A and B) across eight Indian cities stood at around 97 million sq ft, as against 79 million sq ft last year.

This supply is expected to reach 116 million sq ft in 2016. With industrial corridors like Delhi-Mumbai industrial corridor (DMIC) and the expansion and improvement of road network, things are indeed looking up for the industrial and warehousing sectors.

Hospitality

India’s hotel real estate sector landscape is evolving from being largely development-driven to becoming more transaction-driven. Early signs of improvement in hotel operating performances seen in 2015 – following a six-year period of intense economic downward pressures exacerbated by steady hotel supply increases – have rendered the hotel real estate market ripe for acquisition and consolidation.

2015 alone saw nine hotel transactions (excluding partial equity stake buyouts or refinance) equal to the combined number seen in the last two years. Most of these were in the luxury and upscale hotel segments – a major change from previous years. Another key highlight of year 2015 was the transaction of eight operational hotels (nearly twice the number of 2012, the next-highest year.)

The year 2015 stands out due to the nature of deals recorded. The year 2016 is expected to carry on from the momentum garnered in the year 2015 predicated on the U-shaped recovery in the economy and the current state of the hotel sector.

Healthcare & education

The education and healthcare sectors in India are presently facing a huge shortfall of supply which is may soon be met by various international and national players. This will boost the growth of relevant real estate in the time to come.

Growing and emerging residential nodes will enable growth in the healthcare and education sectors, with downstream investments likely come into both sectors from domestic as well as international players.

The education industry, which crossed USD 70 billion by 2015, will require an additional 16 million sq ft of relevant real estate in the next four years. It is poised to see major growth in the future, as India will have the world’s largest population in the 18-24 age group and second-largest graduate talent pipeline globally by the end of 2020.

2016 is likely to bring various new transactions in the education space across the country, primarily related to elementary and K12 schools, and technical institutes.

The healthcare sector is expected to nearly double in value from the current USD 144 billion to USD 280 billion by 2020. More than 150 hospitals could start operations in the next four years, and this will by itself account for about 22.5 million square feet (i.e. 45,000-50,000 beds) of healthcare-related real estate.

Currently, the bed-to-population ratio in India is 0.9 beds per thousand populations, which is way below the global standards of 4.0 beds per thousand population. India requires 600,000 to 700,000 additional beds over the next 5-6 years to meet the demand for healthcare facilities, apart from improvement in quality of existing beds.

Given this demand for capital, the number of transactions in the healthcare space is expected to witness an increase in near future.

Regulatory framework

A lot of groundwork has been done with the central government’s initiatives:

  • Once ‘Housing for All by 2022’, the Smart Cities mission, Atal Mission for Rejuvenation and Urban Transformation (AMRUT), etc. begin to roll in earnest, we will see significantly heightened activity in infrastructure and related sectors.
  • Norms for FDI in the real estate sector have been eased. The government has relaxed FDI norms in 15 sectors including real estate, defence, single-brand retail, construction development and civil aviation. Under these new rules, non-repatriable investments by NRIs as also PIOs will be treated as domestic investments and not be subject to foreign direct investment caps.
  • In order to attract larger investments which are only possible through incorporated entities, the special dispensation of NRIs has now been also extended to companies, trusts and partnership firms which are incorporated outside India and owned and controlled by NRIs. Henceforth, such entities owned and controlled by NRIs will be treated at par with NRIs for investment in India.
  • Licencing norms have been relaxed in states like Haryana, which will help release land for affordable housing. Currently, unavailability of land is the biggest challenge to affordable housing.
  • The Indian Parliament is likely to pass the Real Estate (Regulation and Development) Bill soon. This will bring efficiency, transparency and accountability into the real estate sector, as will the introduction of new financing instruments that have immense potential to improve India’s transparency.
  • Despite REITs opening up late last year, not a single REIT got listed in 2015. In the current real estate taxation environment, there are not enough attractive returns available retail investors. However, 2016 may see some REITs to get launched on the back of reduced interest rates and rise in rental income from office real estate.

Looking forward

India is an underserved economy in terms of real estate requirements. There is a wedge between demand and supply of housing, largely as a result of information asymmetry. However, with increased market transparency, this demand/supply mismatch can offer immense opportunities for developers and investors alike.

The real estate industry is maturing. Until 2014, it was unregulated, fragmented and highly inefficient. Though 2016 will bring in regulation, it will remain fragmented and moderately inefficient. We could see it become a well-regulated, consolidated and moderately efficient industry by around 2020. Growth in the Indian economy will definitely see favourable reflection in the real estate sector, as well.