The strong fundamentals of the Indian economy are having a favourable impact on all asset classes of Indian real

estate viz. housing, commercial office space and retail and hospitality. In recent years, the growth has spread out to tier-II and III cities as well. High growth in services as well as manufacturing sector has resulted in high demand for commercial and industrial real estate. Further the economic growth has trickled down to the large Indian middle class increasing affordability and affluence. Improving living standards are driving the demand for better quality housing and urban infrastructure. In fact, housing in India is today moving from being viewed as a purely basic need to an aspirational purchase. The growth of the sector has been complemented by favourable policy changes like liberalisation of Foreign Direct Investment (FDI) guidelines and significant increase in investment on physical infrastructure.

Residential Property Market On Growth Path

June 3, 2011 tags: Indian Real Estate Market, Property Market, Residential Real Estate by weblinkindiamaps

The Indian real estate market is experiencing a good growth curve these days. After recovering from the slow phase of the global economical

crisis, Indian realty scenario has improved by a great degree. Indian economy is at present, the second fastest growing economy. It is estimated by the experts that it should reach the first position by the time we reach the year 2018. Fast Economic Recovery In the upcoming two fiscal years, the Indian economy is expected to completely recover from the economic slowdown. There was an increase in the per capita income that grew by 10.5 percent. The area investment will also go up as the foreign investment will be increasing. With increased buying power, the demand for acquiring residential property is also on the rise as more people are interested to live in luxurious homes or invest in property that will appreciate significantly in the future. Increasing Business More business activities at both national and international and expansion in the Indian markets are main reasons for high economic growth. Earlier the end users were not given any consideration in the field of real estate and the main transactions were among the investors and speculators only. As a larger percentage of the real estate in India is residential space it was natural for changes like this to happen. Indian Market Is More Transparent Now The level of transparency in the dealings has grown. Its a sign that the domestic real estate industry is growing to the level of the international market. The importance of the consumer has been emphasized here. The slowdown has driven the players to understand the importance of client orientation. More flexibility in business strategies is also gaining significance. Ability To Change The ability to change with the demand in the market has also been highlighted as one of the main factors for demand in the residential property segment. Demand in the real estate market is not a constant thing. It varies from time to time. So it is the need of the hour to go according to the market dynamics. With initiatives taken by the Government and the private developers, there are more affordable and modern housing options available for immediate buying. Therefore, the growth curve is predicted to go even higher in the near future.

FDI
India has been ranked at the second place in global foreign direct investments in 2010 and will continue to remain among the top five attractive destinations for international investors during 2010-12 , according to Development United Nations Conference on Trade and (UNCTAD) in a report on world investment prospects titled, 'World Investment Prospects Survey 2009-2012'. The 2010 survey of the Japan Bank for International Cooperation released in December 2010, conducted among Japanese investors, continues to rank India as the second most promising country for overseas business operations. A report released in February 2010 by Leeds University Business School, commissioned by UK Trade & Investment (UKTI), ranks India among the top three countries where British companies can do better business during 2012-14. India is ranked as the 4th most attractive foreign direct investment (FDI) destination in 2010, according to Ernst and Young's 2010 European Attractiveness Survey. However, it is ranked the 2nd most attractive destination following China in the next three years. Moreover, according to the Asian Investment Intentions survey released by the Asia Pacific Foundation in Canada, more and more Canadian firms are now focusing on India as an investment destination. From 8 per cent in 2005, the percentage of Canadian companies showing interest in India has gone up to 13.4 per cent in 2010. India attracted FDI equity inflows of US$ 1,274 million in February 2011. The cumulative amount of FDI equity inflows from April 2000 to February 2011 stood at US$ 128.642 billion, according to the data released by the Department of Industrial Policy and Promotion (DIPP). The services sector comprising financial and non-financial services attracted 21 per cent of the total FDI equity inflow into India, with FDI worth US$ 3,274 million during April-February 2010-11, while telecommunications including radio paging, cellular mobile and basic telephone services attracted second largest amount of FDI worth US$ 1,410 million during the same period. Housing and Real Estate industry was the third highest sector attracting FDI worth US$ 1,109 million followed by power sector which garnered US$ 1,237 million during April-December 2010-11. The Automobile sector received FDI worth US$ 1,320 million. During April-February 2010-11, Mauritius has led investors into India with US$ 6,637 million worth of FDI comprising 42 per cent of the total FDI equity inflows into the country. The FDI equity inflows from Mauritius is followed by Singapore at US$ 1,641 million and the US with US$ 1,120 million, according to data released by DIPP.

India GDP Growth Rate

India's economy rose 7.8 percent in the three months ended March 31 from a year earlier, after a revised 8.3 percent gain in the previous quarter, the Central Statistical Office said in a statement in New Delhi on May 31. Thats the slowest pace in five quarters. Manufacturing rose 5.5 percent in the three months through March from a year earlier, compared with a 6 percent gain in the previous quarter. Finance and insurance services grew 9 percent after a 10.8 percent jump in the previous quarter. Farm output rose 7.5 percent while mining advanced 1.7 percent, according to the report. The sectors which registered significant growth rates are agriculture, forestry and fishing at 7.5 percent, electricity, gas and water supply at 7.8 percent, construction at 8.2 percent, trade, hotels, transport and communication at 9.3 percent, and financing, insurance, real estate and business services at 9.0 percent.

India Real Estate Report Q1 2011

Business Monitor International Date: Nov, 2010 Pages: 67 Price: US$ 530.00 ID: I3B59104E46EN India's real estate market suffered heavily in the global economic downturn. After the brutal fall in rentals reported for 2009, more companies are now seeking office space on the basis that rents are bottoming out. According to a report released in October 2010 by Cushman & Wakefield, 240mn sq ft of commercial property and about 4.25mn units of residential property will be required to meet demand over 2010-2014. Office space demand will total about 55mn sq feet. Hotels will experience a demand for about 78mn room nights over 2010-2014. Bangalore, the National Capital Region (NCR) of New Delhi and Mumbai will generate demand for about 46% of the Indian office space over the next five years. Demand for office space in second tier cities, such as Chennai and Kolkata, is expected to increase at a faster pace, at about 17% and 22%, respectively. In Mumbai, retail rentals have been on the rebound since the beginning of Q210. They are set to grow further,

averaging 10-15%, by the end of the year. Vacancies are low at a time when retailers are seeking to expand, after the global downturn. Residential property has seen increasing demand over Q210 and Q310. However, supply has been relatively low because of reduced construction activity during 2009-2010. Consequently, demand is expected to be three times the supply in 2010-2014. The staging of the Commonwealth Games in New Delhi in the first half of October 2010 has led to a major real estate market upgrade. Residential property prices in the surrounding areas - which have benefitted substantially from improved infrastructure and connectivity - have risen steadily for at least a year, at levels of 10-15% per annum (pa). The Games Village is a premium development in a prime location. India's economy chalked up impressive real GDP expansion of 8.6% year-on-year (y-o-y) in Q110, propelling full-fiscal year growth to 7.4% in FY2009-10 (April-March). The brisk pace of expansion has been largely underpinned by domestic demand. We are pencilling in real growth rates of 7.9% in both FY2010-11 and FY2011-12, which would put the country comfortably above our emerging market (EM)-weighted averages of 5.5% and 5.1% in 2010 and 2011 respectively. However, this pace of growth is not expected to continue to accelerate as 2010 unfolds. Indeed, the signs are that we will see a cooling in activity. Yet India's long-term growth dynamics are constructive, with the economy expected to enjoy the positive effects of increasing labour productivity, infrastructure build-out and a greater drive for reform. We are pencilling in a mean real GDP growth rate of 7.7% per annum over the next decade, higher than the 7.2%

annual average seen between 2000 and 2009.