The retail real estate market received a fresh mall supply of approximately 1.94 million sq. ft. (msf) in Q1 2012 (quarter ending March 2012). Many of the expected mall projects were differed on account of delay in construction, leading to a deficit of close to 50% from the estimated supply (3.37 msf) for the quarter, says Cushman & Wakefield in its latest report.
It has been strangely characteristic for the real estate and construction industry in India to remain unregulated and unrecognized, even though it is one of the largest employers and contributors to national growth.
Over the last one year, capital values rose by more than 30-35% in Gurgaon’s residential sector. Developers are now going slow on execution of real estate projects, resulting in a drop in supply of residential apartments in most prime markets. Emerging residential areas are still not able to meet the huge housing demand.
It is a highly disappointing budget. The Finance Minister has miserably failed in highlighting the importance the role of Housing in economy, employment generation, apart from the very need of housing. The announcements on ECB for affordable housing is a minor respite but still meaningless.
The Economic Survey, while recognising the importance of the services sector (it accounts for 59 per cent of gross domestic product), has raised concern over the second largest economic activity–housing & real estate. Three months after the government rolled back its decision to allow 51 per cent foreign direct investment (FDI) in multi-brand retail, the survey referred to it as a major challenge before the sector.
Despite a gloomy global outlook, foreign direct investment (FDI) clocked a 31 per cent growth to $27.5 billion during January-December 2011 period. FDI inflows for January-December 2010 stood at $21 billion.
Replicating global trends, the Indian economy is looking towards an impending slowdown in growth due to decline in consumption expenditure, repeated hikes in interest rates and consistently high inflation.
Property consultants and real estate developers have demanded industry status to the realty sector in the forthcoming Budget.
Mumbai continues to be the costliest property market in India but the sales graph show this value has started taking its toll on the volume. Property registration in India’s biggest real estate market continued its slide and in September recorded a 29-month low at 4,137, down 22 per cent year-on-year.
In an effort to enhance professionalism in the industry, RICS has launched its Red Book of Valuation Standards and Global real estate agency and brokerage standards at the recently concluded real estate conference in Mumbai.