Real Estate

Agenda

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Introduction Evolution of Real Estate sector Key drivers Key concepts Classification SWOT Analysis PEST Analysis Life cycle Sources of finance Effect of recession & budget Challenges & future prospects

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Introduction

Real Estate stands for Property (Residential/ Commercial/Industrial)  Real Estate Industry requires multiple layers of Finance  11th Five Year Plan (2007-2012) has indicated India’s housing shortage at around 26.3 million units  Investor interest, huge investments in infrastructure and rapid urbanization led to growth in real estate

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Market Size & Growth

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As per ASSOCHAM estimates

◦ Size of Indian real estate market at US$ 16 billion as of 2008

◦ Growing at 30%

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As per UBS estimates

◦ Total economic value for development activity in real estate sector US$ 40-45 billion

Source: ASSOCHAM & UBS 3

Government Initiative & Spending

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GOI directed banks to provide more finance to real estate sector Loans provided for housing sector is treated under Priority sector lending

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Reduced rate of interest on housing loans

Announced interest subsidy of 1% to home loans up to Rs.10 lakh

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Government Initiative & Spending (Contd..)

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Reduction of excise duty on steel

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Slum-rehabilitation and mass housing schemes are introduced

Indira Aawas Yojna Liberalization of FDI rules for the emergence of real estate funds

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Major Players

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DLF - Land bank of 425 million sq. ft

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HDIL - Land bank of 133 million sq. ft. with larger focus on slum rehabilitation

Other major players

◦ Unitech, Raheja, Parsvnath Developers, Sobha Developers

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Source : Websites of DLF & HDIL

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Evolution of Real Estate in India

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From brokers to reputed builders

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Contribution to India's GDP

Rise in commercial sector DLF goes public Employment generator Moving from unorganized to organized

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Evolution of Real Estate in India

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6%...