Arbaaz Khan Inaugurated Indian Property Show

According to experts, in present real estate is one of the most profitable and secure investment instrument in India and the main reason behind that is the depreciation of Rupee and ease of FDI flow as well as upswing in NRI investments.

On December 5, 2015; in Dubai UAE the most awaited and popular exhibition of Indian properties was inaugurated by Arbaaz Khan, Bollywood actor and Brand ambassador of the Indian Property Show. This Indian Property Show was held at Dubai World Trade Centre for the duration of 4 days ie. December 1 to December 3, 2015 between 11 AM to 8 PM, during the property expo more than 170 developers, Banks and cream of the Indian real estate construction companies participated with more than 600 projects. In this property show entry and parking of vehicle was free.

Details about Indian Property Show:

In this Indian Property Show there were more than 170 exhibitors including real estate developers, construction companies and Banks, however; more than 600 projects were on display. The main attraction of the property show was that here real estate developers were offering amazing discounts with free tickets for visitors, apart from that there were also the kid’s competition which was worth AED 44000 in the form of an apartment worth Rs 25 lacs. In Dubai or UAE this property show was ideal for those who wish to invest in Indian real estate sector as this property show was exploring a variety of properties in India and people have an opportunity to interact with developers on one-on-one contact.

Attractions in the Indian Property Show:

To attract the investors, there were many banks with an aim to finance their investments and apart from that there were attractive promotions pre-launch offers, lucrative discounts and free gifts such as; free air tickets to visit the property in India. Apart from that for children’s there were a special art contest in which they were able to win the gold bars worth AED 44000. First time ever in any property show children have become an integral part of the show as organizers was offering exclusive drawing contest for the Children’s who were between the age of 5 to 8 years and 9 to 12 years. The theme of the contest was “Draw Your Dream Home” where winners in each group were awarded with 100 gms, 50 gms, 20 gms gold bars.

Importance of Indian Property Show in Dubai, UAE:

In present, NRIs (Non-Resident Indians) are extremely active in Indian real estate market and according to reports; NRIs are among the top five investor communities in the Indian realty sector. Apart from that they also have natural affinity to India and due to that NRIs are seeing higher intrinsic value for Indian real estate market and due to that they prefer to own property in India rather than owning property anywhere else in world. And now depreciation of Rupee and ease of FDI flow has provided them reason to invest in India.

According to Sunil Jaiswal¸ President of event organizer Sumansa Exhibitions, “Due to  rupee depreciation by 20 percent against US dollar, it perfect time for NRIs to investment in India and apart from that the other driving forces are; that real estate sector is one of the fastest growing sector in India and it is able to provide big and secure returns with more positive prospects. There are some projects which are coming up in 100 smart cities and these projects have captured NRIs eye with the government easing FDI flow in such projects the investment is expected to boost further”. The more he added that Due to easy payment plans which real estate builders are offering its affordable to manage the investments for affordable smaller units as major developments are coming up in Tier II and III cities and it is expected that investment of NRIs will improve the outlook of property market in India. However; Pune Chennai, Mumbai and Hyderabad are the cities which are most popular among the NRIs due to higher chance of capital appreciation, however; according to property experts, cities like; Chandigarh¸ Jaipur, Coimbatore, Kochi and Indore will come in focus till next year”.

Participants of Indian Property Show:

In Indian Property Show, there were plethora of choice with more than 170 exhibitors, who were there for displaying more than 600 projects with ample opportunity to browse and find the best suitable property in terms of size, city preferences and budget. The main hosts of the property show were some of the best Indian developers such as; Indiabulls¸ Lodha Group, Bhartiya City, L&T, Sobha Developers, Rachana Lifestyle, Unique Group, JP Infra, Sheth Creators, Akar Realty, Sunteck India, Mantri Developers, Ozone Group, Kanakia Kalpataru, Jaypee Greens, ATS Satya¸ Supertech, LifeSpaces, Godrej¸ Saarthi Group, Suvilas Rajesh, Unnati fortune¸ Antriksh and Risara . Apart from that for visitor there were choice to buy property in preferred cities of country such as; Delhi, Noida, Greater Noida, NCR, Navi Mumbai, Gurgaon, Kolkata, Goa, Ahmedabad, Mumbai, Pune, Chennai, Jaipur, Coimbatore, Hyderabad, Bengaluru ,Mangalore and Kochi.

Informative Seminars and Sessions:

All the visitors at the show were able and allowed to attend free interactive seminars for three days which was conducted by the real estate developers and major finance companies and it was the main highlight for this year’s property expo, apart from that people appreciated sessions on Property Taxation, however; the other sessions were; Property Investment in India¸ Taking Care of the Legal Angles, Vaastu, Know Your City, NRI Guide to Property Investment in India, Residential Real Estate Hot Spots in South india and more. Legal experts, also help the investors to take informed decisions on the various aspects of property purchase. Apart from that legal experts were also helping the NRIs to sell their existing property in India at good price.

There were many projects which was offering different kinds of promotional schemes, discounts and free gifts such as; Property Dhamaka offers low-interest loans and fabulous discounts with free air tickets by Jet Airways. Bhartiya City and Indiabulls were the Platinum Sponsors of the property show with Jet Airways,who was the Official Airline Partner. However; AajTak and Sony Times Now were the Official Television Partners and 89.1 Radio 4 was the Official Radio Partner of the Indian Property Show.

Global Rentals Chart

Owing to a vigorous demand from start-ups and e-commerce business, office rentals in major cities of India are experiencing a significant surge. The rising appetite for Indian commercial properties is attributed to about 67% of investments flowing into Indian real estate market from overseas which has been noted to be the highest among all other countries.

Indian cities of Mumbai, Delhi and Bangaluru have topped the global commercial property market with regards to annual rental yields as demand for commercial spaces has picked up in recent times. While Bengaluru topped the list with 10.5% annual yield, other cities like New York, Singapore, London, Tokyo and Hong Kong ranged between 2.9% and 7%, indicates a global survey of property consultant Knight Frank. Mumbai and Bengaluru have also featured among the list of top 5 global cities for future rental growth and the anticipated growth is nearly 22% and 16% for both cities respectively.

Currently, these cities are facing severe paucity of good quality office space in the face of strong demand which is creating an upward pressure on office rentals that is expected to scale up in the range of 6-7% in the next six months year-on year,” says Samantak Das, Chief Economist & National Director of Research, Knight Frank India.

Although the aggregate vacancy level of commercial spaces is at 17%, occupiers and investors are facing a challenge in procuring quality office spaces across prime business districts in the country where vacancy is in single digits.

The Indian commercial real estate sector is making a comeback after experiencing massive slump for over three years.  With a healthy pipeline and recent large ticket transactions, early signs of revival are being observed.

Big corporate occupiers are returning to the market hinting at an improved business sentiment. Bengaluru and Mumbai have been leading with these large transactions.   In May this year, while Tata Consultancy Services leased over two million sq ft of built-to suit space at Hiranandani Estate in Thane in Mumbai, Flipkart hired a 2-million sq ft custom-built office campus in Bengaluru.

Lucrative offers- Combo of residential apartment

If you think that it’s impossible to own apartment in low cost or get job in the city like Mumbai, so this time you are wrong because now real estate builders are making an unusual promises as recently one of the Mumbai based real estate announced that his company is offering residential apartment in just 6.25 lakhs in Mumbai’s far outskirts with a helicopter joy ride and a job for one of the female member (from buyer’s family).

Karrm Infrastructure, which is famous for providing budget home in Mumbai, has promoting their latest project with lucrative offers on newspapers and on local radio. Their latest project is coming up at Shahapur, which is about 56 miles away in northwest of Mumbai. Karrm Infrastructure is offering residential units at seek 90 monthly payments of Rs. 7,000 rupees each and they are claiming that there are no hidden cost as well as project is as per the standard of “Vastu,” a local version of Chinese feng shui. It seems that company is seeking to tap the affordable market in Mumbai and that Cushman & Wakefield Inc. estimates has estimated the worth of company about $11.8 billion. According to Karrm, the low budget projects provides swimming pool, a hospital, school and a super market and apart from that the largest unit offered is about 202 square feet – all of one room, toilet and kitchenette.

In the metro cities like Mumbai, the demand for low-cost units is rising as PM Narendra Modi announced his “Housing for All by 2022″ scheme, however; builders prefer to construct high-end apartments in the cities like; Hyderabad, Mumbai, Delhi, but now they are struggling to clear the inventory pile-up of high-end apartments. According to Sanjay Dutt, Executive Managing Director of South Asia at Cushman & Wakefield, “Urban residential units has long been neglected in India because of certain reasons such as; high land prices, low margins in the segment and delays in getting approvals, but now with renewed focus from the state and central government, we are expecting that this segment will get proper momentum in near future”.

20 percent discount on full payment:

According to the statement of sales representative at Karrm Infrastructure’s office site, “All units will be ready in next two to three years and job offer for female member of the buyer’s family will be at food processing factory which is coming up at same region”. As per the statement of Shyamsundar Kamat, a Chauffeur in Central Mumbai, “This offer is not good enough because it’s too far from work location, and if he will buy Karrm’s units, so it could shave his five to six hours in day. The more he added that it doesn’t make sense for me because I can use my traveling time to do extra productive or non-productive work. Shahapur region is too far for those who are working in Mumbai. This is the true reality of land starved Mumbai, where the premium paid for a home near the work place is too high. But Ketan Patel, project Head at Karrm Infrastructure was not available in his Thane office and didn’t respond to requests seeking comments.

Building residential units for those who are from lower or middle class can make sense as it can help to boost the volumes in a real estate market as Indian real estate companies are struggling with the sales of residential units. In last quarter, the sales of residential units in India’s top eight property markets has fell by 4 per cent, however; the percentage of unsold inventory rose by 18 per cent, as per the research and data of Liases Foras, which estimates that it will take at least 45 to 50 months time to find potential buyers for unsold homes in Mumbai alone. It is expected that by the end of 2031, urban population in India will reach 600 million from 377 million in 2011 as per the estimation of central government, and there will be the shortage of 18.78 million residential units in urban housing segment. Now Central government is focusing on reducing squalor in modern cities and towns and due to that central government have shortlisted 305 cities and towns in nine major states of country to start building houses for affordable segment.

Steve Waugh

Cricketer Steve Waugh promoted Waugh Global Realty has entered the domestic realty market by launching a portal to gratify the housing demands of NRIs. Waugh’s entry into the Indian real estate has come at a time when the realty sector is going through turmoil as inventories are piling up. This is likely to entice more NRIs to invest in India’s property market as they may fetch good bargains.

“NRIs are enthusiastic about investing in the Indian realty market. Many are looking at good properties in the country not only from the investment perspective, but also to settle down later.

He says that the venture is a result of the commitment Waugh made to himself that “he wanted to play a shaping role in India’s growth story over the next 10 years”. According to a report in Economic Times, this is first such platform that caters to the NRI market. “Our aim is to concentrate on the NRI investment experience through the online medium,” Waugh, founder and chairman of the company has been quoted as saying in a report.

The portal currently has 91 properties listed on its portal of 10 developers across seven cities — Delhi NCR, Mumbai, Pune, Hyderabad, Bengaluru, Chennai and Kolkata. Waugh Global has partnered with leading developers like the Lodha Group, Godrej, Shapoorji, K Raheja, Kalpataru, Kolte Patil and Sobha Developers, among several others.

Dean Honan, the Managing Director of Waugh Global  explained that the focus of the portal is not only confined to listing properties but also to offer a broad range of additional services like property management and rental solutions, land advisory services, NRI qualification and activation services. The company also plans to introduce Australian property sales and market entry gradually.

Indian real estate

In the absence of due diligence the Indian real estate market can loss basic fundamentals and get drive by the positive news stories. However there are no analytical techniques are available to support those stories. The market intelligence of the prospective buyers is only reflective in macro level market which often goes off track. Most of the buyers are agree that due diligence is the way for to manage the risk and returns in terms of property evolution. More than that, it can give the much needed facelift to real estate sector. Due diligence is probably the most important aspect of a transaction involving real estate immediately following a broad understanding of the commercials.

According to Bilateral business body of India and America and economics experts “when market is fulfill with potential of growth and debt price is higher than equity so it demands for a greater common sense”.  In the eco-system of Indian real estate market there is financial disorder, as investors are getting the higher interest rate in market, which is giving the best ROI. The problems with these investments are that, high returns are available in market with high risk with the absence of reliable data. The answer to the dilemma of the investors and funding of the serious developers lies in creating a plain and simple mechanism of due diligence.

A section of the analysts mention that due diligence has always been done in the Indian real estate, but the Bull Run made some of the developers a bit over ambitious to ignore the fundamental in order to get the higher profits with far higher risk. However the slowdown has taught  everyone a lesson and now developers are over cautious at the each level, but the fact remains that in the absence of scientific and industry accepted mechanism of due diligence the challenges and risk exposure are as much for the realtors as for the investors. According analysts the developers and independent property consultants should focus more on micro markets than general trends which could be misleading. Whenever there are many grey areas where in the absence of proper research and search and reliable data even assessment of ground realties is not feasible.

According to Rohit Gera, MD of Gera properties, agrees over the need of proper due diligence across the real-estate sector of country. Unfortunately the home buyers still do not undertake the requisite amount of due diligence especially when buying the homes from fly by night operations. The cost of reliable due diligence often is less than one month’s EMI and this offers peace of mind through 240 months of loan payment. Sometimes customers blindly believe that they will not be the victims and they can go forth without proper due diligence. There are number of reasons for the absence of due diligence in real estate sector.  The growth of real estate transaction combined with the growing participation of the organized sector in real estate, which resulted in heightened awareness of the risks involved and, consequently, the need for ensuring that the risks are identified and minimized in such transactions

Now that we have a new government, their initiatives to make India one of the top investing countries seem to be getting paid rather quickly. As per the latest that we have heard the American real Estate tycoon Mr. Donald Trump is eyeing and planning for investment in Indian hotel and real estate sector.

What’s the investment all about?

The promises given by Mr. Modi led government to enhance the infrastructure and boost economic growth of the country seems to have impressed Mr.Trump and he is looking for significant investment in the country. Mr. Trump was in India to launch his Trump tower in the financial capital of country- Mumbai.

So what made Trump to change his mind?

This investment has been probably due to the business and friendly minded leader of the country. He stated that if he was asked about investment in India couple of years back, it would have been a completely different situation.

Indian real estate market has been seeing a huge setback due to the high inflation rate and interest rates, there has been considerable decline in the home sale and huge loss has been incurring losses due to this. Post the change of the government in India, there has been nearly 5% increase in the home sales across metropolitan cities, which is comparatively 11% higher than the growth seen during the previous government rule 2 years back. Looking at the current home sale Real estate investment trust has been started to boost the foreign investment in the real estate sector.

In addition to the investment in the Indian real estate sector, Mr. Trump has been looking for investment in hotel and skyscraper in USA as well as has projects lined up for places like South Korea, Dubai and Turkey.

Trump Tower:

In order to win over the millionaires residing in India, the Trump tower will be a 75 storey and 800 Foot building.  As per the Lodha group, top luxury real estate developer, the aim behind the tower is to raise the level of luxury and services in India. It is aiming to create a new definition to the Skyline of Mumbai. This tower has been planned to include 3 to 4 BHK with indoor Jacuzzi and the price tag could be expected more than $80 million and more.

Mr. Trump has started the Trump tower in collaboration with the Lodha Group of India and has given hint of another probable investment in the city of Pune which is due for completion in 2015.This also might to be by entering licensing pact with another company.

US NRIs have been always keen on investment in their home country. The demand for Indian real estate is estimated to be 25-30 lakh. However, it is not the same case in all the Indian cities. There are end users who want to invest in some specific cities for their families preferences as well as investors looking for time to time returns on investment.

Apartments are the most preferred choice by a majority of NRIs but the demand mainly revolved around units in the price range of Rs 60 lakh to Rs 1.25 crore. Incidentally, NRIs from California region are less interested in villas for cities like Bangalore and Chennai. Other cities that drive demand include Hyderabad, Mumbai, Pune and Delhi. However, the demand for Hyderabad has raised especially after the bifurcation of the state into two.

Among the secondary cities that drew demand were Coimbatore, Mysore, Mangalore, etc. There has been a constant demand for medium-term investment in selected options like developed plots in the price range of US$10,000-30,000. NRIs prefer to leverage the appreciation to invest in larger units at a later stage as they are very well aware that land appreciates at a much faster rate in India than any other asset.

Time to time returns on investment through rental income and availability of property management services are among the major criterias for investors to get interested in investment in integrated township projects.

NRIs from cities like Houston show high level of interest towards Indian real estate as their local market does not provide the flexibility of deploying funds locally in order to earn more rental income. Thus, as per the realtors there is a shortage of housing in the local market.

The demand for villas priced over Rs 3 crore did not evince much response as high-end units require specific marketing and not typical property shows targeted to attract all types of investors. Instead exclusive road shows and HNI meet are more better options which would prove to be beneficial for real estate developers while marketing niche products among target audiences. But this has to be well packaged as investors are more interested in the after-sales services offered by the developers through property management companies in today’s scenario.