Best time to bargain for Indian realty? It's now

SBI executives at the NRI Banking Fest in Dubai on Friday.

Non-resident Indians (NRIs) in the UAE are a key target market for Indian developers. Justifiably, this is why 12 major Indian builders were out in full force to tap prospective customers at an NRI Banking Fest being held by State Bank of India in Dubai on Friday and Saturday.
Asset Homes, Skyline Builders, Sobha, Ozone Group and Olive Builders and Developers are a few among the developers participating in the event.
Most developers are of the opinion that despite the current lull in demand following the demonetisation exercise, the Indian property sector is likely to gain momentum in the first quarter of 2017 as home loan interest rates are likely to be slashed.
"People are adopting a wait-and-watch approach to assess the market situation. In terms of land deals and resales of land plots, there will be a correction in prices. This is the right time for end-users to buy property. There will be a hike in property prices in the next quarter or the following quarter because of the introduction of the Real Estate Regulatory Authority in India," says Praveen Menon, manager of overseas sales at Skyline Builders.
The Kerala-based builder has units for sale in projects in 10 major cities in Kerala.
Meanwhile, a senior executive from Sobha Group urges investors to capitalise on current discounts and favourable payment terms.
"Before demonetisation, sales were taking place, although at a slow pace. In Dubai, we were closing sales for around eight to 10 Indian properties per month. But it has come down by 80 per cent now. After the end of January, we are expecting a positive trend. We expect the market to pick up soon," says Anand Mani, assistant manager of sales at Sobha Group.
Sobha Group is primarily displaying its projects in Bengaluru at the NRI Fest. The developer also has projects in Chennai, Kochi, Coimbatore, Pune and New Delhi.
"Most NRIs in the UAE, especially from Kerala, prefer to invest in Bengaluru owing to the high rental yields and other factors. A lot of our North Indian customers are also looking at Bengaluru," said Mani.
The Skyline executive claims vertical units are in demand in Kerala owing to the scarcity of land. "Villas are expensive for investors and hence volume sales occur in the apartment segment. The young generation salaried class comes in to buy apartments whereas businessmen and vice-presidents of banks or senior executives in the oil and gas industry purchase villas," Menon observes.
Dr Sarita Shukla, a visitor to the NRI Banking Fest, was keen to explore various options on display at the Banking Fest on Friday.
"We moved to Dubai around a year ago and wanted to open an NRI account. That's why I am here," Dr Shukla said.
 
Overlook short-term pain, top SBI executive advise
A senior executive of the State Bank of India (SBI) believes demonetisation will result in short-term pain, but the crackdown on black money will be a boost to infrastructure development in India.
"The shift towards digital transformation and a cashless economy is happening. The Reserve Bank of India will soon be augmenting the supply of ?500 notes. The bank has disbursed currency worth ?480,000 crore into the banking system. Only counterfeit notes worth ?100 crore have been seized. Somehow, the system has been compromised. But, the proportion is very miniscule," says Rajnish Kumar, managing director of SBI. He says SBI has been doing 10 million transactions daily after demonetisation, of which more than 75 per cent is through ATMs.
"We are looking for good lending opportunities. Credit growth in India has been sluggish last year and this year. Post-demonetisation, it has been flat. The investment environment has to improve in the country," Kumar adds.
On SBI's merger with its five associate banks, Kumar said it would result in a better quality of service and reach and lower interest rates for customers. "There may be some relocation of branches but no mass closures after the merger. The reorganisation and optimisation of our branch network has been ongoing," he clarifies.
- deepthi@khaleejtimes.com