Of late there has been much hullabaloo around the progressive initiatives taken by the Government of India to drive growth in the Real Estate and Infrastructure Sector. We are all aware of the much touted 100 SMART Cities Project, the Atal Mission for Rejuvenation and Urban Transformation (AMRUT), the Sardar Patel Urban Housing Mission (SPUHM), Development of Industrial Corridors, Swacch Bharat Mission, Clean Ganga Mission etc. Alongside the launch of these mega projects, very large financial figures in terms of hundreds of thousands of Crores, are also being widely promulgated for public consumption. Without a doubt these are steps in the right direction and will inspire confidence, especially if backed by requisite funding and time bound monitored execution on the ground. As a prudent analyst of Real Estate and Infrastructure I sincerely hope that these projects and their supporting policies translate into firm action and yield positive results sooner than later. The Government definitely appears to be doing its bit to revive, promote and drive growth in this key sector of the Indian economy.
However, it is common knowledge that the Real Estate sector has been down and out for more than half a decade now, not only nationally but globally as well. It is not my intention here to analyze the macro economics of the current situation; rather my aim is to help define the market clearly, given the current socio – economic environment in India and suggest dynamic strategies for focused targeting and effective domination of the same. I have restricted myself to an analysis of the Residential Space for the time being; in due course I will deliberate on the Retail and Commercial Spaces as well. I am certain that professionals at all levels in the real estate development value chain will find my analysis useful. It will definitely help fine tune and boost their specific strategies, so that a cohesive effort can be applied to usher in the much required revival.
Back to Basics
I find that with passage of time, there is a tendency of real estate players to lose their bird’s eye view of the situation and get enmeshed in a herd mentality. This is exactly what has happened in the present day scenario. The loss of focus has resulted in a diffusion of effort that adversely impacts top and bottom lines. The enthusiasm, dynamism and cutting edge of a decade ago has been lost and what remains are lumbering, ossified monoliths which are struggling to stay afloat. This is therefore a good time to take a step back and re-look at the fundamentals. Appreciating the demographics and socio – economic indicators affecting the residential real estate space in India today, will help us regain focus, understand and overcome challenges and optimally utilize the opportunities being created through Government initiatives.
Before we start tweaking and innovating strategies to meet the current situation, we need to get back to basics and answer a few key questions. Who is Buying, What are they Buying, Why are they Buying and How are they Buying? Answers to these fundamental questions will remove the opaqueness that has clouded our vision. It will bring about clarity to all real estate players by helping re-identify contemporary segments and consequently enable a more focused and effective targeting of the same. It is therefore absolutely imperative to ensure that our effort is concentrated towards appreciating the demands of the customer base against the backdrop of their current socio – economic conditions. It is only after such an understanding has been achieved that realistic and improved real estate products can be developed. And any product that is realistic and relevant is bound to succeed, increasing volume growth and ultimately profitability whilst meeting the genuine needs of the customers.
Watch this space for more !