Exponential urbanization and tremendous employment opportunities have made NCR one of the fastest-growing regions in the country.
It is the largest urban agglomeration in India, with more than 28 million urban residents (around 7.5% of overall country’s urban population).
The accelerated urbanization and rampant migration of working population from different states have created a tremendous need for affordable housing in NCR – and the requirement keeps growing.
A recent ANAROCK report shows that NCR comes out on top in terms of the number of units added in the affordable housing segment (priced < INR 40 lakh) during the last two years, and accounted for around 26 to 30% of the overall affordable housing segment’s supply across the top Indian cities.
The region’s share of new launches in the affordable segment has grown from a mere 21% in 2012 to 71% in 2017 (up to Q3).
While the entire region possesses the opportunity to shine in this segment, ANAROCK’s report has identified some pockets which qualify as the key destinations for affordable housing projects in NCR.
Every year, the Union Budget presents the Government with an opportunity to tweak the direction that the Indian economy is taking. Sometimes, hard decisions are taken which, while necessary, do not necessarily go down well with Mr Everyman.
At other times, the Union Budget is clearly meant to be a crowd-pleaser. This invariably happens when an incumbent Government is finishing its term and general elections loom, for obvious reasons.
The current Government has done a lot for the Indian real estate industry, even when it was in the form of hard decisions like demonetization and the disruptive but very necessary RERA.
With the hard decisions now taken, the Indian real estate sector fervently hopes that it is at the receiving end of the benevolence implied in a populist budget. This benevolence needs to go beyond improving personal finances and the implied boost to real estate investment appetite.
Despite the Government’s very proactive stance towards cleaning up and regulating the sector, there are still several policy-related pain points where the coming Union Budget can make a decisive difference:
Santhosh Kumar Quits JLL, Joins Anuj Puri’s ANAROCK As Group Vice Chairman
New Delhi, 11 January 2018: Real estate industry veteran, Santhosh Kumar, today joined Anuj Puri’s new age real estate firm ANAROCK Property Consultants as Group Vice-Chairman, after more than a decade with international real estate consultancy JLL India as CEO – Operations.
He will be based out of ANAROCK’s Gurgaon office, with ANAROCK’s nine India offices, Dubai office and Finance reporting directly to him.
A long-standing associate of Anuj Puri, Santhosh Kumar was closely involved in the merger of Jones Lang LaSalle and Trammell Crow Meghraj (TCM) which created the largest international real estate consultancy in India.
As CEO of Operations, he had P&L responsibility of JLL India’s 11 offices, ensuring their seamless business operations and growth. He has over 20 years of hands-on experience in Indian real estate.
“Santhosh’s domain expertise, experience and impeccable relationships with the leading real estate players are invaluable assets for the Firm”,
Once a quaint settlement known for its scenic beauty with lush green trees and inhabited by Eurasians and Anglo-Indians during the late 1880s, Whitefield has witnessed a shift from being a settler’s haven to one of the sought-after real estate destination of Bengaluru.
Whitefield is one of the key tech hubs in Asia and has evolved as a preferred residential real estate destination.
Falling in the eastern periphery of the Greater Bengaluru region, Whitefield is a burgeoning micro-market with a rich history of over 200 years. However, the spurt of real estate developments in Whitefield dates back to early 2000s when the IT-ITeS sector began to boom.
The establishment of Export Promotion Industrial Park (EPIP) and International Technology Park of Bengaluru (ITPB) shaped Whitefield into a buzzing suburb. Today, more than four lakh ‘techies’ work in various multi-national companies located here.
Over the last few years, Whitefield’s skyline has metamorphosed into tall skyscrapers and big residential communities. The housing demand in this region is primarily driven by the IT professionals working in nearby office complexes.
With the advancement of the Internet and e-commerce, the ‘human touch’ and ‘face-to-face’ interactions are on the decline.
Hand-written letters and postcards have gone the way of the dinosaurs, and even e-mails are rapidly becoming passé as the world shrinks into smartphones and messaging apps replace almost all other modes of communication.
The way we shop has definitely undergone a massive sea-change over the past few years. Less than five years ago, ordering food, groceries, clothes, furniture and a whole lot of other commodities and services with the click of a button would have seemed like far-fetched science fiction, but it is a reality today. And it’s not only in shopping where the human touch faces obsoletion, but almost all forms business.
The Internet was not the only factor involved in the ‘dehumanizing’ process. As an asset class, real estate had become increasingly commoditized and home purchase became more of an investment play done purely for financial gains.
Thankfully, the slowdown in the Indian property market put paid to the extremely damaging speculative activity that drove up prices and created a staggering burden of unoccupied homes held solely for capital appreciation.
Whenever I’m asked how real estate is performing in India, I have to ask the questioner to be a bit more specific. Real estate is not a single industry but consists of various categories/asset classes, and each behaves differently at the same time and at different times.
Residential, commercial and retail real estate each serve a very separate and distinct purpose, respond to a different type of demand and attract different types of investors.
However, it is equally true that all three categories are inter-related because they all depend on each other to drive growth. Residential projects tend to crop up around commercial office catchments, because that is where jobs are created, and employment drives the financial ability and appetite for homeownership.
Likewise, retail real estate developments are only feasible in and around residential and commercial catchments, since retail needs customers. What differs in these three asset classes are the ticket sizes, investment rationale, and investment horizon.
2017 was an unprecedentedly rough one for the Indian real estate sector with the implementation of RERA, GST, demonetization and several other reforms and initiatives.
The residential market was beset by more policy changes in this single year than in the two preceding decades. The resulting distress signals that this notoriously change-averse sector sent out were loud, though not necessarily clear. However, there were also positive vibrations.
Tuning Into Residential Real Estate’s Distress Signals In 2017
In 2017, the residential property sector saw:
The lowest rate of new project launches in last five years:
2017 witnessed a significant fall in new launches across top 7 cities, which declined by around 45-50% compared to the previous year. While in 2016 the top 7 cities added around 2.4 lakh units, new launches shrunk to only 1.25 lakh units in 2017.
Property prices either stagnating or correcting:
In 2017, due to a massive burden of unsold stock and low demand,
The year 2017 will be remembered as the year of disruption and radical policy reforms in the history of Indian real estate.
While RERA and GST might be considered as a disruption by the industry, the government’s sustained efforts towards promoting affordable housing provided some hope to the beleaguered residential sector.
The year 2017 was another watershed year for the residential sector, where neither new launches nor sales could ignite the hope of revival. As 2017 comes to end, developers are hoping that the year 2018 will bring in the much-anticipated revival of the residential sector.
Unfortunately, 2018 is expected to be no different than 2017 because of these notable trends:
1. Weak consumer sentiment will limit the revival
The weak job market, and slow GDP growth rate has negatively impacted consumer sentiment and they might continue with their stance of being extra cautious and conservative while making long-term financial commitments.
2. Developers will be under immense stress
Developers will continue to be under tremendous pressure for completing the projects as the consumer activism will increase and cases delayed possession will be taken up seriously by RERA.
Once an anonymous destination comprising of small villages in the peripheral areas of Pune, Hinjewadi is now a prime real estate hotspot.
With the launch of the Rajiv Gandhi Infotech Park and consequent entry of various IT-ITeS majors and multinational companies, Hinjewadi has witnessed spectacular growth in working population.
The accompanying demand for homes, backed by improving social and physical infrastructure, has made Hinjewadi one of Pune’s fastest-growing micro-markets in Pune.
During the early 2000s, the Maharashtra Government introduced its game-changing IT-ITeS Policy which offered liberal incentives to the technology-driven industries to set up operations in Hinjewadi.
Waiving off stamp duties for owned and leased properties built on MIDC land also aided the large-scale development of this region. Thus, the 2,800 acres Rajiv Gandhi Infotech Park, also known as Hinjewadi IT Park, came into existence.
IT Leads the Way
The establishment of the Hinjewadi IT Park acted as a powerful magnet for IT-ITeS companies, whose arrival and expansion have been the primary growth drivers for the real estate market of Hinjewadi.
ANAROCK Launches Report On Affordable Housing In NCR
Supply-absorption break-up of units priced < INR 20 lakh & between INR 20-40 lakh
Key hotspots, supply as per completion timelines
Delhi, 14 December 2017: ANAROCK Property Consultants today released its definitive research report ‘NCR – An Affordable Housing Goldmine’ at the Delhi leg of Economic Times’ ACETECH – Asia’s leading trade fair for architecture, building materials, innovation and design.
The report pitches the phenomenal expansion and urbanization rate of India’s largest planned region against the real estate industry’s affordable housing response. Intensely data-driven, this study lays bare the opportunities, shortcomings and challenges that Delhi-NCR presents to the real estate sector.
Anuj Puri, Chairman – ANAROCK Property Consultants says, “Affordable housing has once again taken centre-stage in all real estate forum discussion, and deservedly has the undivided attention of all industry stakeholders including developers, investors, customers and the Government. As India’s largest urban agglomeration, Delhi-NCR is extremely important from every perspective –