Defining the new-age home buyer, understanding how fence-sitters are moving towards making the ‘buy’ decision when it comes to homes, as also dealing with RERA and its impact were the highlights of the inaugural session at the annual CII Realty & Infrastructure Conclave, which was inaugurated in Mumbai.
Niranjan Hiranandani, Managing Director, Hiranandani Group of Companies
said the stake holders in Indian real estate needed to ramp up the quantum of work by eight times i.e. 800 per cent, if the target of ‘Housing For All by 2022’ was to be achieved. “It is a challenging situation, where things are yet to speed up,” he said. On Affordable Housing, Niranjan Hiranandani said high land costs and heavy taxation made ‘affordable Housing’ a concept which was difficult to achieve. Welcoming RERA, he said while it would bring in more transparency and was good for the home buyer; it placed the burden of delays in possession squarely on real estate developers. “There are stakeholders who are also responsible for delays, and they should also be held accountable for delays,” he said.
The Conclave’s theme, “Steering Through Varying Speeds – Championing Various Asset Classes of India Real Estate” was perfect given that different classes of real estate assets were moving at different speeds, said Anuj Puri, Chairman CII Realty & Infrastructure Conclave and Chairman & Country Head JLL, India.
In his introductory remarks, Anuj Puri pointed out that Indian real estate faces a very different scenario in the near future, give the proposed changes in the regulatory environment as a result of RERA, among other aspects. “How will these new challenges be faced? This will define the future of the real estate industry,” he said. He listed ten positives which Indian real estate had witnessed since the previous Conclave, as also he elaborated on ten challenges which the coming year would bring.
Arun Nanda, Director, Mahindra & Mahindra Ltd
said the industry needed to go back to basics, and pay attention to what the customer wanted. “The world is changing, disruptive is the key word in today’s world; ‘Normalcy’ is what real estate needs to go back to,” he said. Ensuring that work gets done as per schedule was important, as was ensuring that the new age customer and their needs were understood; as also implemented. “The new age customer will go to Consumer Fora, if there are shortcomings as regards what was promised and does not get delivered,” he said. He also stressed on the need for real estate companies to work out finances and handle debt properly, saying this was among the biggest challenges facing Indian real estate.
CII and JLL India released a research report on the Indian real estate industry, entitled 'Indian Real Estate: Coming To Terms With Varying Speeds of Growth'.
The report touches upon the varying speeds at which real estate asset classes have been performing in India over the past few years as also the reasons. The divergence in speed and direction of growth within the office, retail market and residential markets finds its roots in the country's economy, which is also moving at multiple speeds within specific sectors. The report focuses upon the complexities that arise in allocating investable resources across asset class within real estate, and suggests investors should sharpen their research and focus so as to continue to extract good returns from their real estate investments.
Speaking during the session, Faye DSouza, Magicbricks NOW
gave an example of someone who after two years of searching for the ‘right’ home had finally made the decision to buy. This decision was important, she said, because it showed that fence sitters were willing to buy, but it also brought into focus the change in buyer profile from what it used to be a few years ago. “The home buyer looks not just at the project, but also considers the real estate developers’ reputation, customer outreach ad service is important too,” she said. The home buyer will not hesitate to opt for consumer for a or legal options if the real estate developer is unable to deliver as promised, she added.
Conclave Chairman Anuj Puri said the report mentions challenges presented by varying speeds of growth in the Indian real estate sector. “It also suggests real-time solutions; one of these being increased speed in delivery and implementation of policy initiatives,” he said. Current consumer confidence levels possibly signal that the potential growth rate of retail real estate is rising, but there is the aspect of constraints, in form of inadequate supply and excessive competition which require intervention. Likewise, the residential market currently faces a dual challenge of product-mismatch and affordability - both of which can be addressed by clearing approval-related delays," he concluded.