‘As developers, we need to take steps to instill trust among buyers’

[ecis2016.org] While demonetisation may force Indian investors to consider properties abroad in the short term, greater transparency and price stability, will open up interesting investment opportunities in Indian realty over the long-term period, explains PNC Menon, chairman-emeritus of Sobha Ltd

With properties in India and the Middle-East and plans to expand operations into the UK market, PNC Menon, chairman-emeritus of Sobha Ltd, speaks to Housing News on how NRIs perceive India’s real estate market and the impact that recent policies, such as demonetisation will have on housing demand.

You are reading: ‘As developers, we need to take steps to instill trust among buyers’

Q: How will demonetisation impact the real estate market?

A: The impact on the economy will be significant, as a large part of the black economy will become part of the Indian economy. This is certain to reflect in next year’s GDP figures. The attack on black money, through demonetisation, is also expected to significantly boost the government’s revenues. With a large part of unaccounted cash coming into the system, a lot more money will become accountable and taxable, than was the case earlier.

Q: Will it affect the real estate investment cycle?

A: We may see a surge in Indian investments in properties in Dubai, as people look at various new avenues to recover some of their losses. Dubai is turning into a sought-after destination, to invest in tax-free property with solid returns, for investors and end-users who are looking at a second home.

Read also : Illegal religious structures near metro: HC seeks DDA’s reply

Q: A number of NRI investors remain apprehensive about the Indian property market. How attractive is the Indian real estate market for foreign investors?

A: India is a huge market with over 1.2 billion people and an emerging economy on the global front. When we entered the Indian market in 1995, we were conscious of the fact that a developer can capture a big market, by introducing international quality processes at affordable prices, without compromising on delivery. NRIs continue to represent a healthy proportion of our client base. India’s real estate sector has matured to a point, where NRIs are now able to invest in a wide variety of products, across the affordable, mid-range and luxury segments. With tighter regulations, greater transparency, more affordability and enhanced price stability, NRIs will find interesting investment opportunities, as long as they have a long-term view and are discerning about which project to invest in.

[ecis2016.org] NRI investment patterns become realistic

Q: What is your mantra for survival in real estate?

A: We have just entered the United Kingdom market. The two markets where we mostly operate – India and the Middle-East – go through cycles of uncertainties, every few years.

To survive, one should follow the simple business philosophy of not over-leveraging. In a business where the conventional wisdom of debt-equity ratio has gone for a toss, one of the important lessons that I have learnt, is that if you have $100, you should not borrow more than $50.

Read also : Noida and Greater Noida officially accept invitation to join Global Sustainable Cities initiative

Q: Does the general perception of the Indian property market bother you?

A: I am concerned with the overall poor perception that people have of the realty business and it is time we collectively take steps, to instill trust among buyers.

Q: Do you feel that consumer activism has led to a situation, where home buyers have become unreasonable? How can the trust factor be improved?

A: Home buyers are not unreasonable consumers, who will expect houses to be built in a year. However, they do expect updates and constant communication, along with transparency. Trust can be built, through simple measures like updating customers on a monthly basis, with photographs of construction progress, or even creating a YouTube link, to offer live feed from the construction site.

Depending on its size and complexity, a project may take 36 to 60 months to complete. Developers can always have a flexible timeline for possession, in their contracts.

(The writer is CEO, Track2Realty)

Source: https://ecis2016.org/.
Copyright belongs to: ecis2016.org

Source: https://ecis2016.org
Category: Lifestyle