A budget bonanza is a wish that businesses across the sectors dream about and real estate is no exception. Real estate, as a matter of fact, has to its claim being the key contributor of GDP and job market, besides accelerating a number of allied industries through backward and forward linkages.
Some call it market intelligence and not due diligence where the focus should be more on the micro markets than general trends which could be misleading. However, there are many grey areas where in the absence of proper research and reliable data even the assessment of ground realities is not feasible.
In real estate, market dynamics is so more complex that all the marketing theories and economic rationale have already gone for the toss. The conventional financial definitions are often challenged by the imbalance of demand & supply. With real estate predominantly being a micro market business, each market has its own dynamics.
The new regulatory regime is largely about steps, which include streamlining approval processes, simplifying taxation (GST), building institutional capacity, as also introducing urban planning and real estate-related reforms (RERA and REITs).
One of the most critical aspects of in business is ‘Caring Factor’. Every business on the face value tells its customers and stakeholders, including the employees, that it cares. It cares about them; it cares for them. It wants to make them feel loved and appreciated.
An outside view on the Indian real estate market may get confused with the fact that mismatch in delivery and performance is lesser in luxury projects than even affordable housing. Isn’t it a fact that buyers in low income housing are more price conscious and more concerned to check & cross check than those nouveau riche who have enough money to splurge?
The data analysis reveals that about 26 million sq ft of Grade A office buildings are under various stages of construction in the city which will completed by 2020. Most of this upcoming supply is concentrated in Outer Ring Road (ORR), which is a major commercial hub in Bengaluru.
The real estate industry stakeholders are elated with such a prospect since the tax slab being discussed at 5% & 12% is lower than the present taxation. Niranjan Hiranandani, President, NAREDCO said the move would benefit the consumers who will only have to pay one ‘final tax’ on the whole product. This is obviously a good thing to happen, and the real estate industry will welcome the move.
The prevailing sentiment among the home buyers is quite negative. The developers have definitely failed to identify the strategic and operational challenges that can goad the sector to adopt the best practices. There is no specified industry standard that can be widely accepted as best practice and the industry bodies are seen as builders’ lobbies.
No one would like to admit or put on record but privately most of the developers maintain that their major investors have pulled out of market, both for land finance as well as for investment in the under-construction inventory.