Monday, 24 October 2016

Current Scenario of Real Estate in India

Current Scenario of Real Estate in India

With the year 2016 approaching towards an end, we look forward to the New Year and revisit the Real Estate developments and the changing trends in the industry. It makes a lot of sense to revisit all the developments that have happened so far in this sector and how it will impact the coming year of 2017 for Real Estate Growth.

India’s Real Estate Sector is the second largest employer after agriculture and is expected to gain its reputation after the implementation of RERA in each state. It has been gathered that the real estate sector will generate revenues worth US$ 180 billion by 2020 as against US$ 66.8 billion in 2010-11. The real estate industry has evolved over the past decade and have moved towards being a more mature and organized industry. It is moving towards a direction where we are having global investors amongst others seeing the long-term potential as our economy is amongst the fastest growing economies in the world. With a lot of action and regulatory changes, the industry has a mixed reaction but I feel that the year 2017 will be positive for the investment purposes.

Speaking specifically of the year 2016, the secondary market had been booming at a good pace. As a matter of fact, the last two years were more of a policy formation and adjustment phases starting from the supply to the demand phase. As per the industry experts, the market is slow but this slowdown in Real Estate is not an indication of problem, rather it’s a return of normal market rates and a more balanced and mature market. With a majority of home buyers between an age group of 28-35, the changing economic conditions of the country will surely add to consumers’ wallets and allow them to either make the purchase of their first home or upgrade to a new one. The trends like smart cities, green cities, high rise cities, affordable housing etc are attracting a lot of investors and developers to cater to the these buyers. With the upcoming RERA guidelines this is playing a very crucial role in making the developers serious with their delivery timelines. The developers are not trying to put their act together and be RERA compliance and avoid any penalties and fines. Also, with the history of all the undelivered projects in the past, there is now a lot of demand for ready to move in properties and projects nearing completion.

Moreover, the residential market is moving towards the realistic pricing and is attracting the end users who were sitting on the fence to take a decision in buying a property. For them this is the best time to buy Real Estate.  We suggest that don’t expect exorbitant returns in the present scenario but a decent upward graph will be seen in the Real estate prices starting 2017. Investor sentiments are still not that great but it is bound to revive in the coming year 2017. With the real estate regulatory amendments; credibility and positivity is building up confidence in the minds of investors who will sooner or later get drawn back into the market.

According to data released by Department of Industrial Policy and Promotion (DIPP), the construction development sector in India has received Foreign Direct Investment (FDI) equity inflows to the tune of US$ 24.19 billion in the period April 2000-March 2016. The central government is expected to execute a slew of big ticket economic reforms over the next 2 years as it strengthens its presence. Ease of Doing business, freedom to operate 24 / 7 - The central government is taking numerous steps towards cutting red-tape which has delivered positive results.

In 2016, office space demand was mainly driven by IT/ ITeS, e-commerce, start-ups and large consulting firms.   As per the research surveys by research companies, Commercial market remained strong in Q2 2016 with 10.4 million sq ft of office absorption totaling to about 19.2 million sq ft YTD. The demand was well supplemented by the new supply and existing vacant stock, but vacancy levels have gone down in most of the cities due to limited addition of new supply.
The central government took fresh steps to boost foreign direct investments (FDI) in real estate. Several clauses governing entry and exit of foreign investors were relaxed or removed. Several steps have been undertaken by the central government over the last 2-3 years which have helped enhance investment inflow in the country. As per industry data- Foreign Direct Investment (FDI) inflow in the country increased by 29.32% compared to previous year and stood at $40 Billion for FY 2016. The FDI stood at $30.9 Billion for the same period, previous fiscal. Foreign Direct Investment (FDI) inflow in the country increased by 29.32% compared to previous year and stood at $40 Billion for FY 2016. Private equity inflows in the real estate sector rose 33 per cent to Rs. 5,193 crore in the first half of 2016 on an improved investment climate following reforms like the real estate regulatory law, easing of FDI rules and introduction of real estate investment trusts (REITs), according to property consultant. The Indian real estate sector has witnessed high growth in recent times with the rise in demand for office as well as residential spaces.

With the Union Budget, I am sure that the Government is affirmed and committed towards affordable housing and real estate sector by the announcement by RBI on the repo rate cut immediately after the Budget announcement. This cut in home loan interest rates is very beneficial and one of the most effective way of boosting property sales. With it helping more individuals with lower – middle income group to buy their own homes, this will also help to offset the slump faced by the real estate sector. With a lot of initiatives being taken by the central government to boom the Real Estate market, I am sure that with the cash flows in and out of the country the market will get impacted positively. Currently Real Estate is in a mid phase of policy formation and implementation. The need of the hour is to move towards a corrective side where there are realistic rates with realistic transactions taking place. To conclude, the sentiments of the domestic market in buying and selling of Real Estate has changed over a period of time and looking at the current trends we expect a huge turnover in Real Estate transactions by 2017.

Monday, 17 October 2016

Self Promotion for Realtors

Self Promotion for Realtors

We hear over and over that networking is a critical component to any successful business. But there’s something else that goes hand in hand with networking: Self-promotion is a crucial element to your success in spreading your business horizons and attracting new clients. It is a very common saying that in sales, you’re not just selling real estate, you’re selling yourself and that is why in a business like Real Estate self promotion becomes all the more important.
Real estate agents may not have huge marketing budgets. In fact, even agents who work for more recognized brokers need do some personal marketing to stand out from the competition, so it makes sense to have a few dependable low-cost promotion strategies on-hand. Marketing your real estate business does not have to be expensive. Prime time advertisements may be an effective way to get in front of a lot of viewers, but it can also break a typical agent's promotional budget. Luckily there are more than a few low-cost strategies for self-promoting in the real estate business that produce great results.

Take a look at the ideas listed below.

Business cards are one of the effective ways to self-promotion. Sharing your business card not only looks professional but also is one of the easiest and cost effective ways of promoting yourself.  Many Big International Brokerage companies use business cards with our professional pictures on it. It has a very general psychology behind it. Your picture makes your face as a familiar face and people feel that “they know you” when they meet you next!

Keep your elevator speech ready:  It is always good to be ready with your elevator speech about yourself and your business whenever you meet a new person because you never know, he/she might be your next potential client. The best part about real estate is that everyone loves talking about it and is keen to learn what’s happening in the market. Keep your facts and market updates ready so that they find value in what you are speaking. To make clients for lifetime, your first interaction with them should be memorable so you should already have in mind some key points of your conversation with them. 

Presence on Social Media: An active online presence on social media platforms like Facebook, Linkedin, Twitter, Instagram, what’s app etc is also a must to reach out to masses. You should keep posting about your initiatives, marketing activities, best practices, market updates etc and make your profile more interactive rather than jut information sharing. You need to capture every new lead and maintain a contact with all your current and past clients. Strengthen your relationships with them and give them great advice. Once people will start viewing you as an expert, they will themselves come back to you when they need your services.  As a fresher in this industry, make sure you touch base with maximum number of people you can to create your own clientele.

Focus on referrals: Real Estate is one of the biggest financial decisions of a person’s life and a large percentage of your business comes only from referrals. People feel more comfortable in working with a person whom they can trust and with whom they have done business in the past. Referrals only come when you provide an excellent customer service. A simple thing such as wishing your past clients on their birthdays or other special dates is a way to stay in touch and be remembered when they need you.

Also we have to consider the point that as an agent the person has to market himself amongst the clients as an industry expert. He needs to be well versed with the upcoming developments in the real estate in that area of his work. Moreover, the market has been changing in the Indian realty sector and there has been a lot of efforts put together to furnish the real estate demands and the sanity of this industry. The goal of self promotion is to be remembered in a particular way, ideally, right at the time they need your service.  You cant just wait around for others to promote you.  Get out there, promote yourself and do a great job for those you work with.

Sunday, 16 October 2016

Trends in Real Estate Brokerage

It is very interesting to see these new trends taking up the traditional methods of doing Real Estate. It is a fact that gone are those days when the customers used to completely  rely only on Real Estate brokers and agents for all the information required for their home search. The property portals now provide sufficient and the right amount of information in just a few clicks so that customer knows what he/she want and what fits in their budget. The role of an agent has now shifted from the first point of contact to a Consultant whom the buyer finally contacts for an expert opinion, guidance on financial planning and a quicker closure. Even with so much of information and facilities available online, in the end you would still need a Property Consultant to guide you through the process as the information available online is not sufficient to crack a transaction. You would always need proper expertise from the time of the booking till the last piece of documentation is complete. Internet has been successful in shifting their role from the keeper of the listing to a guide and a negotiator for their client.

Internet is now the first point of contact when it comes to research and it has a huge influence on the final decision. With so many opportunities available sitting in your comfort zone and without doing the leg work, online Real Estate helps the buyer to search for properties in a city where he/she doesn’t reside. Online resources provide us with all the requisite information to do their preliminary home research without actually visiting the project site. With maximum amount of information provided about a particular property with reference to the property details, prices, locations, 360 degree view, nearby amenities, contact details of the Consultant, price and feature comparisons with other similar projects etc; the trend of researching online is the technique followed by most of the home buyers now days. Also, seeing the success rates and the increased number of individuals using these platforms, the online portals have started incorporating processes to verify the listings and avoid any kind incorrect listing on their portal.

Moreover the age bracket of people buying or investing in property has drastically gone down and a lot of young people who are technically savvy prefer to go online before anything that they purchase, be it a phone or the most expensive investment of their lifetime i.e. their home. They look for listings through mobile apps and websites for searching the house they want and then consult a Real Estate professional who could show them the properties they have shortlisted. With Internet having so much influence on the final buying decision of today’s consumer, most of the retailers like Snapdeal, Amazon, Flipkart etc are working heavily on their app based shopping platforms as they are getting majority of traffic from the mobiles. Moreover, a lot of “angel investors” have been investing in these start –ups to capitalize on this booming market.      

Tuesday, 11 October 2016

Tips for real estate investors

Tips for real estate investors

By-Mr. Sam Chopra, Founder & Chairman, RE/MAX India
Investing in Real Estate is one of the first options that comes to everyone’s mind when we thing of a long –term and a safe investment especially in a country like India. But since the sector is so diversified, investing in it without a long – term vision can be a little tricky. That is why my first suggestion to everyone looking to invest in Real Estate is that it should never be an instant decision that you make. It is something that will directly impact your financial future, so set a right way to being this journey. The good part of this business is that depending on your financial capabilities and your experience, it has a variety of opportunities you can invest in. So first set your budget, explore the available options, evaluate their pros and cons, compare the possibilities and then make a smart cum safe investment that will make you grow financially.

For the first time investors, it is very critical that one understands the fundamentals of Real Estate. It is one of the biggest business opportunities for an individual as it can open up multiple avenues for making more money. With it having a capacity to multiply your wealth, a veteran realtor who carries good experience and understanding of all the things that you need to succeed can be very helpful in making the right decision. He can give you an expert advice and get the right things done for you. In addition to it, you as an investor should also invest in increasing your own Real Estate knowledge so that you can proceed smoothly. As new investors, with the first investment that we make, we start thinking that it is going to make us rich there and then; but we need to understand that Real Estate demands a lot of patience. The market scenario keeps on changing, so you need to proceed very carefully.

Real Estate already is very unorganized and has multiple angles. There is always a right and the wrong way of doing this business. As beginners we tend to makes a lot’s of mistakes as first of all we are sometimes not clear of what we are getting into and secondly we sometimes avoid following the systems. It is very appealing but it demands a lot investment in terms of time to plan and strategize your investment decision.

In Real Estate, one simple fundamental that will always reap benefits is “Take Risk, Take Action”. After analyzing and understanding all the possibilities and risks involved in this business, the important part is that ‘Are you has to be prepared to take that kind of risk’. We always want to add Read Estate to our investments portfolio but it requires a lot of initial funding and a regular cash inflow to protect you from getting stuck at a later stage. It is just about that risk taking appetite and a strategic planning that will help you in accomplishing success.

In a nutshell, I feel that first of all an investor should identify his investment horizon, whether he wants to invest for a short- term or long- term and the kind of Real Estate they would like to invest in. A comparative analysis of the market trend/rates versus the opportunities available can help them figure out what will bring the best ROI. Last but not the least, before anything one should understand the plans of the government for that particular market as that is one of the most crucial factors to decide the success of the investment.