NRIs eye luxury homes post-pandemic; Bengaluru & Pune in high demand: Survey – ET RealEstate

The luxury residential real estate once again seeing huge interest from Non Resident Indians (NRIs) due to plethora of reasons that have made the last few months the best time to invest in a home after rising instances of delays and consumer activism in the last few years had impacted sales from this segment.

ANAROCK’s latest consumer survey, at least 73% NRIs now prefer properties priced between Rs 90 lakh to Rs 2.5 cr. In the pre-COVID survey (H2 2019), just 41% preferred properties within this price bracket – most favoured affordable and mid-segment homes. 3 and 4 BHK options currently top their wish-list.

Prashant Thakur, Director & Head – Research, ANAROCK Property Consultants says, “The COVID-19 pandemic has increased NRIs’ emotional association of long-term security with physical assets. 63% of the polled NRIs state this as their reason for buying homes in India now. They are also driven by the uncertainties posed by COVID-19. Luxury properties have emerged as a hot favourite with NRIs because of the depreciating rupee value translating into greater buying power, coupled with ongoing developer discounts and offers. A majority of NRIs is buying for end-use, not as investments.”

The IT hubs of Bengaluru (24%) and Pune (19%) are seeing the highest NRI demand. Collectively, these two cities saw approx. 48,370 homes sold in 2020 – accounting for a 35% sales share among the top 7 cities.

According to the survey, at least 67% of the polled NRIs are looking for ready-to-move-in homes. If we consider the overall survey trends (including NRIs and resident Indians) just 29% preferred to buy RTM homes, with another 27% respondents preferring under-construction properties that will be delivered within a year.

Of the total 24% survey respondents who already booked properties in the last six months, at least 38% were NRIs looking to make the most of the prevailing market conditions in India, including discounts, offers and lowest-best home loan rates.

86% of the polled NRIs will only consider properties by branded developers who have the highest project completion capabilities, resulting in the lowest execution risk. Another reason for this choice is NRIs’ desire to buy into projects with international-grade amenities.

According to the survey, most of the polled NRIs seeking property in India are aged between 35-45 years of age. Among all NRI respondents who participated in the survey, close to 68% considered real estate as the best asset class for them at this time.

Regarding their outlook on residential property prices, at least 44% respondents felt that prices will remain stable in the short-term (i.e. 12 months), while 27% feel they will increase during the year. Over the long term (i.e. in 5 years), 92% NRI respondents think prices will increase.



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Ambuja Neotia and Hiland Group to jointly develop 20 acres of land in Kolkata – ET RealEstate

NEW DELHI: Ambuja Neotia Group and Hiland Group have joined hands to develop 20 acres of land in Kolkata. While the first 10 acres of land is situated along the Golf Course, the other 10 acres of land is near the Calcultta Riverfront.

Two residential projects having development potential of 2 million sq ft each will be constructed.

Bata India was the landlord of both land parcels. ANAROCK Property Consultants‘ land division has helped facilitate the deal of both land parcels, it said in a media release.

Along the golf course, the two groups will develop 12 residential towers (G+13) comprising of approx. 2,000 units in 2 & 3 BHK configurations. The Riverfront project is currently being planned and further project specifications will be announced soon.

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Net office absorption seen at 31 million sq ft in 2021 – ET RealEstate

MUMBAI: Net absorption of office space in 2021 is expected to be at par with the last 10 years average of 30-31 million sq ft in India despite the challenges created by the ongoing pandemic, said property consultants.

The emergence of the Work-from-Home model given the lockdowns and safety of employees has impacted the demand for office spaces as only a fraction of employees are coming to offices. However, the numbers are expected to improve with the access to the vaccine.

“I am pleasantly surprised by the absorption. Honestly, I didn’t think that this calendar year will be 50-60% of 2019 absorption. In June, I would have said it would be between 16 to 19 million sq. ft, but now the net absorption is likely to be somewhere around 25 million sq. ft. It is surprising,” said Anuj Puri, Chairman, Anarock Property Consultants.

After the dip in net office absorption in the June-Septmber quarter, it started improving gradually.

“In comparison to Q2, the absorption went up by 63%, but if we were to compare Q3 of the last year, the absorption went down by nearly 47%. So, last year in the first nine month we saw nearly 32 million sq. ft. of net absorption. This year, in the first 9-months, we have only seen 17 million sq. ft. Hence, we expect this year to end with around 25-27 million sq. ft absorption and in comparison to 46 million sq. ft. last year, this is still a drop of 42-45%. 2019 was a very extraordinary year of 46 million sq. ft. It will be wrong to take that as a benchmark,” said Ramesh Nair, Country Head and CEO, JLL India.

According to Nair, the average of the last 10-year can be considered as a benchmark, which is around 31 million sq. ft. and there is a very good chance that in 2021 would cross that number. In 2019, it was 46, but a year before in 2018 it was around 36 million sq. ft.

While net office absorption has improved considerably, only a fraction of employees have returned to work place so far. The percentage is further low when it comes to information technology parks.

“Our research shows it is actually 8% at large campuses. There are two main reasons for it. There are many companies which have gone ahead and announced remote working plans till March 31, 2021 and employees don’t need to come to office. Secondly, employees themselves are not very confident given the public transport situation in the country. It is a gradual process. Occupiers are highlighting that things are improving but very gradually and WFH don’t work for everyone and people will slowly start coming back to office,” Nair added.

Puri echoes the thought. “We don’t think we are going to see people coming until the vaccine is there. It is 9-11% at various office parks and companies are not pushing their employees. Whether WFH works or not is a question mark, but until the vaccine comes in, the percentage will continue to remain low.

According to Anshul Jain, MD-South East Asia and India, Cushman & Wakefield, people are scared but there is also a clear distinction between personal and work. They are out in markets, going everywhere buying stuff, but when it is about coming to offices, they are not keen because of corporate cultural issues.

Jain believes that there will be a lot of experimentation in the office set up in the coming months with work-from-home and other concepts but nevertheless, the future of commercial real estate is bright in the coming fiscal.

Overall office absorption has been impacted because of the WFH arrangements considering the pandemic. Impact is here to stay for few years, but not permanently.

“If we have to put a number for the next two year of how much real estate office absorption is going to be impacted because of WFH, it would be around 20-25% for the next two years,” said Nair at a webinar organized by Workplace Trends India.

The future of co-working is looking robust, as average co-working space has doubled during 2020 compared to 2019, they said.

“Average co-working space has doubled to 70,000 sq ft in 2020 from 35,000 sq ft in 2019. Enterprises are taking up space in co-working setup and these coworking players are now catering not just to freelancers and startups but to larger enterprises and hence they are taking up bigger spaces. The future of the co-working space is really bright,” mentioned Nair.

However, Jain believes that Co-working operators have to concentrate on enterprise clients to stay afloat.

“There were two-three different types of customers for Co-working or Managed office space. There were individuals, there were startups and then there was enterprise. The first two individuals and startups may continue to work from home and they may not come back until 2021, by 2022 they might come back, therefore focus on enterprises,” said Jain.



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Covid-19 impact: Homebuyers’ enquiries for relatively larger apartments surge – ET RealEstate

MUMBAI: The emergence and acceptance of the Work from Home model in the backdrop of the ongoing Covid-19 pandemic has led to increased demand for relatively larger homes. The new demand pattern is driven by homebuyers’ need to accommodate space for remote working.

In key property markets including Mumbai Metropolitan Region (MMR) and Bengaluru that are conforming to the new work from home reality, a rising number of enquiries are being made for larger configurations.

Over the last few months, enquiries for larger homes in Bengaluru have increased up to 40% with property seekers predominantly scouting for 3-bedroom apartments with average 1,800 sq ft built-up area as against the previously-preferred 2-bedroom units, showed data from ANAROCK Property Consultants.

“The current buyers are largely working couples with children, most currently pursuing the WFH and e-learning options. In many cases, their budgets have not increased – rather, they are willing to settle for peripheral locations to secure bigger homes and a better lifestyle at a more affordable price,” said Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants.

In Mumbai, the country’s most expensive property market, the trend is more visible in projects that are located in the peripheral areas. According to developers, many homebuyers are considering of upgrading from one-bedroom apartments to 2 bedroom units and upward.

“We are witnessing spurt in demand for 3-bedroom apartments and prospective homebuyers are also keen on upgrading from 1 and 2-bedroom units that they had booked earlier in the same project. This is certainly being considered by them given the emergence of work from home option,” said Rajesh Prajapati, MD, Prajapati Constructions that has 3 ongoing projects in Navi Mumbai.

In Noida and Ghaziabad, an increasing number of buyers are looking for 3 or 4 bedroom apartments, as opposed to the previously-preferred 2 bedroom units. Those with lower budgets are showing interest in 2 bedroom units with a study totaling around 1,200 sq ft of built-up area.

While demand for both 2 and 3 bedroom units in Gurgaon is as consistent as before. In Hyderabad, the preference for large homes of minimum 3 bedroom units was in place even before the pandemic and its fallout, Santhosh Kumar added.

Homebuyers in India usually begin their homeownership journey with small starter homes with an intention to upgrade to a larger pad at a later stage. These upgrade decisions are usually taken when affordability improves. According to property brokers, the current record low home loan rates, attractive discounts and offers by developers are prompting many of them with stable finances to take the decision.



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