Track2Realty: Gujarat has cornered the maximum share, 41 per cent, of new investments attracted by the real estate sector across India during the last fiscal, apex industry body ASSOCHAM said on Monday, May 6.
Oberoi Realty is looking to lucrative markets beyond its home market of Mumbai and is now planning to foray into new market of National Capital Region. The company has outlined budget of nearly Rs 150 crore for this and is aiming to do so in the current financial year, a top company official said.
Track2Realty: It has been a marginal rate cut that may not have any significant affect on the fortunes of the economy in general and real estate in particular. However, the sector believes it still goes a long way in improving the sentiments of the market by and large. On Friday, May 3, the Reserve Bank of India (RBI) cut its policy interest rate by 25 basis points, for the third time since January as growth slows and inflation ebbs. RBI says there is little room to ease monetary policy further.
Track2Realty Exclusive: Real estate has not just been innovative but also aggressive in raising money. They have raised money against sales with a guarantee that if the price falls, they will buy it back. It has been a protection on the bank’s side that if the prices fall, of course there is a margin of about 20% and if the prices fall more than that, they will buy back. 20% has been the cut off because about 10% is the expense in buyback, brokerages, paperwork etc.
Track2Realty Exclusive: The Pune realty market in many ways is very different from many other cities in the country. Pune has showed tremendous resilience and a quick bounce back in the aftermath of the 2008 global crisis. In many ways, Pune depicts the behaviour of an extremely mature market leading to low levels of volatility in terms of capital values of the homes.
Track2Realty-Agencies: Government has said on Friday, April 26, that complaints were received against 27 real estate firms across the country for alleged forgeries and dubious investment schemes, out of which 18 are being probed by different regulatory and enforcement agencies for further action.
Track2Realty Exclusive: Realtors rue that in spite of all the scrutiny, even today realty does not have the right formula. The issue is not to go public or whether the people who have already gone public are right or wrong. The issue now is if while going public, there is a solution where the actual value is derived on the basis of how other industries value themselves? Only then it makes financial sense to go public as the sector has seen successful IPOs also.
Track2Realty Exclusive: Kruti Jain, Director, Kumar Urban Development, believes any funding available in real estate is gap funding. It is not about only the gap which is there in funding for real estate because what happens for other industries is that they have this reserve capital which is not their land or raw material, but is the actual capital they put in to manufacture xyz product and then they replenish the funds with whatever returns are accrued.
Track2Realty Exclusive: The realty market has been pretty exposed to the greedy investors and vulture funding, not venture funding. In desperation the developers often lost track of what kind of funding was required and met with the disaster. Amidst the cyclic very high and very low there has been off balance debt-equity ratio as well. Of late, some developers tried within the box and some outside it. The needs and solutions are different for listed and unlisted companies. Still the sector is in search of right funding mechanism and as Track2Realty finds, are guinea pigs in the funding market.
Track2Realty-Agencies: Chennai-based real estate firm Real Value Promoters Private Limited plans to raise Rs 100-200 crore from private equity (PE) players for its projects.