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Interviews - Real Estate Facts Of 2012 And Foresight Of 2013


Source: Small Enterprise
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editor@probro.net

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Chennai,Chennai,Tamil Nadu.

 The March, 2013 edition of the popular business journal ‘Small Enterprise’ carried an interview with Mr. Ramartheya Krishnamurthy, the President of CommonFloor.com. This interview captures facts and figures of the Real Estate sector in 2012 and where the sector is heading in 2013

Ram reasons points out the reasons behind the slow growth of the sector in 2012 and what we can expect in the current year. Apart from that he also comments on the Real Estate business in India, throws light on the overall jest of how the rising urbanization offering more opportunities in real estate business and how could one would account for the growth in Tier – 2 cities, about the effects of the economic downtown affecting the demand against excess supply, etc.

Excerpt of the interview:

Q: What is your comment on the Real Estate business in India?

A: Real Estate industry has been pivotal in the growth of the economy in India. With the GDP pegged between 5-6% this year, the real estate market could grow anywhere between 8-10%. Among the big cities, Bangalore and Delhi-NCR are leading the growth especially around the outskirts; while Tier – 2/3 markets like Coimbatore, Nasik, Nagpur, Patna are also witnessing good progress.

 

Q: How is the rising urbanization offering more opportunities in real estate business and how would you account for the growth in Tier – 2 cities?

A: Raising urbanization is having phenomenal impact on the business. Real estate follows industrialization, as people come to work, they bring their families and settle in and around big cities. The new age middle class is young and vibrant, likes to spend in malls and aims for higher standards of living, which in turn fuels the growth in micro market economies.

Tier – 2 is definitely the next destination for property developers, because of rising incomes and buying capacity. Development goes where money is, and today, it is there in Tier – 2 cities. Tier – 1 seems saturated, especially markets like Mumbai.

Q: Is the economic downtown affecting the demand against excess supply?

A: I would say No. It is not as bad as 2008 -09, when the Global slowdown severely hit the industry and it took some time for us to get back on track. Today we should talk about “right” demand and “right” supply; on the two ends of the line – budget properties have high demand and high supply, so doing good. Similarly top end properties are also doing good; limited demand and limited supply.

Additionally the market has innovated and there are a number of business models today that reduces the risk, both for the consumer and the developer.

 

Q: Real estate has still not been given an industry status. How would you comment on this?

A: Better late than never, an industry contributing in billions to the GDP deserves and industry status for sure. I’m sure the policy makers of the country are thinking on the same lines.

 

Q: Real estate business is a highly disorganized market. How would you comment of the emergence of one – stop shops?

A: This is like the real estate market in India, fragmentation will always remain till we have very strong government, governance policies, which I don’t see happening. They will work only of they play with customer service as differentiator.

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