Thousands of new Realty Brands have hit The Indian Market in The Recent past. The Current Dynamism of The Sector Accomodates them well, but Ambiguous Positioning Threatens long Term Survival of many
When I take a ring side view of the kind of advertising that a number of real estate players are doing today to lure customers into having a dekko at their property, one particular indicative orientation that never fails to catch my attention is the availability of a ‘golf course’ in the vicinity. In the years that our generation grew, the very term used to bring to mind pictures of cigar chomping, jet setting first world millionaires (in dollar terms) moving around with their caddies and a number of other helpers at their beck and call, often on the other side of 50; hitting birdies as well as winning multi-million dollar deals on those very greens – all in a days work!

Count on good ol’ Indian ingenuity to make first world luxuries so commonplace and to distort such well established stereotypes to the point of no return. On one end, these players are actually utilising that particular USP to symbolise their ‘products’ as luxury. Admittedly, the middle class of today is becoming a stickler for affordable (even seemingly so) luxuries, and therefore the broad approach makes sense. But on the other end, they are also playing with the luxury image of a golf course and ending up losing sight of the very objective for which they had planned the entire exercise.

It’s a crazy rush for a share in the Indian realty space. With India’s housing shortfall pegged at anywhere between 20-70 million residential units by World Bank, competition looks hardly enough to make it crowded yet. The demand is expected to be even more if you go beyond actual need. A fact of India’s shifting demographics is that growing numbers of working couples are looking to stay away from parents, which is expected to provide a further boost to the demand. As the global economy shifts focus towards China and India, there is understandable optimism among realty players on the future value of their current investments. By 2050, Indian cities are expected to have some 854 million residents according to UN estimates, which is just about the entire current population of US, Brazil, Russia, Japan & Germany combined.

When you look at economic profiles, the market divides itself into several levels. Around 148.92 million Indian households (60% of total) have an annual household income of less than Rs.80,000/-. At the next level another 132.66 milllion have annual household incomes that start from around Rs.80000 and go upto the Rs. 1 million plus range. There is a visible resurgence in the commercial segment as well post slowdown, with office rentals growing by 5-15% in major commercial centres across India, as per a research by Cushman & Wakefield. Pune led the resurgence followed by Delhi. The research firm projects demand of around 240 million sq. ft. across India in terms of commercial space by 2014. However, a huge 46% of this demand is still expected to come from the three major regions of NCR, Bengaluru & Mumbai.

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Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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