Track2Realty Exclusive: The real estate clan in the NCR region has come a long way ahead particularly with the housing sector most likely to witness a notable recovery, by the second half of 2013. The rising prices and high interest rates of the RBI have caused a drastic slash in sales. Adverse market dynamics such as high debt, piled up inventory and depressed market conditions took the sector for a rather harsh toll.
Track2Realty-Agencies: After fashion weeks and wedding exhibitions, India is now set to welcome a first-of-its-kind Real Estate Luxury Show (RLS India 2013), which will serve as a platform for showcasing the properties of the country’s real estate giants.
Track2Realty Exclusive-Yearly Analysis: DLF is raising funds by selling non-core assets, Godrej Properties raised funds through a QIP and HDIL is generating funds by selling transfer of development rights (TDR) and floor space index (FSI) — all to lighten the debt burden. Earlier, companies were building land banks and were rewarded for it in the stock market. Now, they are conserving cash to payback creditors.
Track2Realty: Today there is no entry barrier in the sector for any fly-by-night operator with black money to back his initial pomp and show to lure customers. But for a serious start-up there are many perils that plague. Problem is all the voices are being raised to ease only a section of the developers with often myopic vision with regard to the future of the sector.
Track2Realty Exclusive-Yearly Analysis: In a market where the five largest firms saw 75 per cent erosion in their combined market capitalization, burdened with debt and struggling with poor growth, there are few lessons these realty companies have been forced to learn the hard way.
Track2Realty: India Ratings has revised its outlook for the Indian real estate sector to negative to stable for 2013, from negative in 2012. Demand remains subdued and EBITDA margins low, leading to weak credit metrics for companies in the sector. The agency however sees signs of improvement, in terms of stability of margins and the easing of liquidity pressures, with free cash flows turning positive since H2FY12.
Track2Realty Exclusive-Yearly Analysis: To say that Indian real estate is standing on a shaky foundation would be like stating the obvious. Pressure is increasingly building on Indian developers. High mortgage rates and the slowest economic growth in nearly a decade are taking a toll on demand. Costs are rising, too. The Price of steel and concrete has jumped to double digit. The pipeline of cash has already dried up.
Track2Realty Exclusive: Call it being overt critical on the realty business or my sense of introspection, I maintain that the biggest drawbacks in the sector is we are not sure what precisely we want from the government, nor is there any clarity as to how this will help the sector; whether our demands are feasible from ethical, financial or legislative point of view.
Track2Realty-Agencies: The government is likely to come up with a Bill in the forthcoming Budget Session of the Parliament to regulate the real estate sector, Housing Minister Ajay Maken said on Wednesday, Dec 9.
Track2Realty: The year 2012 witnessed subdued interest in real estate due to inflationary pressures and rising interest rates in the country, coupled with the on-going economic crisis in the Eurozone and US.