The year has turned and many await how the real esate sector will fare after a disappointing year that was 2015. In India, investors and customers alike are also waiting for the prices to stabilize and for developers to deliver pending projects.
Live Mint reports that "tepid home sales, rising inventory levels and weak sentiment pulled down India's property markets in 2015" and there is no sign of possible recovery in the days to come.
The trends to watch, according to Live Mint are as follows:
Year of fund-raising
Private equity (PE) fund are planning or have already raised funds from overseas investors to invest in real estate in 2016 amounting to about $4 billion. For example, Edelweiss Alternative Asset Advisors Ltd, part of diversified financial services firm Edelweiss Group, is raising up to $1 billion for its first residential real estate fund while Housing Development Finance Corp. Ltd (HDFC), through an entity, is close to raising $850 million.
A slow and gradual recovery
Developers have learned from their mistakes and are now focused on project execution and delivery. There might be better home sales and prices may stabalize.
More platform-type deals, more offshore investors to come in
More offshore investors are likely to come in with the government easing foreign direct investment (FDI). This will also give chance to smaller-sized investments, not to mention more exclusive partnership platform transactions between Indian developers and investors.
Commercial office space
The commercial office sector did well last year and it is expected to do even better this time. Vacancy levels have fallen and reality firms, aside from ensuring business growth are also shifting their targets from residential to rent-yielding office projects.
Meanwhile, the companies to watch this year in India include, DLF Ltd, Lodha Developers, Piramal Realty, Paranjape Schemes (Construction) Ltd, Tata Realty and Infrastructure Ltd and Tata Housing Development Co. Ltd.
