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        On a bitterly divided planet, there is still one subject that gets everyone talking in
        unison. From Seattle to Sydney, Dublin to Dubai, people are obsessed with housing
        booms that threaten to burst in bubbles. Londoners still buzz about Lakshmi Mittal,
        the Indian steel tycoon who in April bought a mansion in Kensington Palace Gardens
        for $128 million, making it the most expensive house ever sold. European football
        stars bid up the prices on an artificial island in Dubai before the first building is
        complete. Middle-class Thais trade tips on securing space in one of 50 new Bangkok
        condo projects. Americans gossip that in the most glamorous neighborhoods of
        southern California, panicked status-seekers are bidding sight unseen before the good
        times end.

        Rising house prices were fueled worldwide by the reckless prosperity of the late '90s,
        but also by the caution that followed. Stock prices started to collapse in 2000, and
        bonds began to slump in 2002, but that only accelerated the flow of money into real
        estate. Families burned by the markets came to see a house not only as a place to live
        but as a way to invest pension money—even to shield the nest egg from the risks of
        terror attacks. This idea of real estate as a safe haven is now firmly embedded in the
        global culture, says Yale economist Robert Shiller.

    Source : Newsweek

June 2005                                                                      THINK INDIA, THINK TIMES
                                   The India Advantage

   Fourth largest economy in the world with GDP of US$ 3.2 trillion by 2005..Goldman Sachs

   National Income in 2003– US$ 40528 mn..Statistical Outline of India 2003-04

   Literacy rate – 65%
Most forecasts indicate that by 2020 India's gross national product will overtake or be
on the threshold of overtaking European economies…..According to the report prepared
by CIA's National Intelligence Council, called 'Mapping the Global Future ’...
 India has more companies listed on the stock exchange (over 7000) than the rest of
the Asia-Pacific region.
Indian economists have said that gains made from stock market speculation during
periods of boom are known to find their way into real estate.
The Real Estate Index has risen by 13% since the previous quarter and more than 27%
since last year.
Indians are the highest savers in the world. In fact India has higher on household
savings as a percentage of personal disposable income vis-à-vis all Asian countries
except the Philippines.

June 2005                                                                         THINK INDIA, THINK TIMES
                                          Advantage India

            Once an all time favourite of the Indian investor, gold today is being shunned as
            prices heat up and despite higher prices, buying property is number two on the
            investors list.

                                Consumer Preference for Durables*
                                                        Jan-05    Jan-04
                                Two-Wheeler                  4.1        3.5
                                House                        3.7        2.9
                                Mobile Phone                 3.7        4.2
                                Colour TV                    3.2        3.5
                                Refrigerator                 2.6        2.4
                                Four-Wheeler                 2.3          2
                                Gold Jewellery               1.4      10.7
                                Microwave Oven               0.5        0.6
                                Diamond Jewellery            0.1        1.8
                                  * Measured as percentage of consumers
                                planning to buy the goods over the next six

     Source:The Economic Times Intelligence Group

June 2005                                                                     THINK INDIA, THINK TIMES
                                          Reserve Bank Policy
            The latest policies of The Reserve Bank of India released in Feb 2004, made the Rupee almost freely
            convertible. The future looks good for those who want to invest abroad, be it shares or property.


            Individuals: Resident Indians will be free to acquire and hold immovable property or shares or any other
            asset outside India without prior approval from the Reserve Bank of India.

               Resident Indians can also hold foreign currency accounts with a bank outside India.

               In a calendar year an Indian can send upto US$ 3,70,000 abroad. The break up is shown below :

                                  For private visits                US$ 10,000
                                  Gifts                             US$ 5,000
                                  Donation                          US$ 5,000

                           Maintenance of a close relative          US$ 100,000 (per recipient)
                           Medical Expenses                         US$ 100,000
                           Business Travel                          US$ 25,000
                           Studies Abroad                           US$ 100,000 (per academic yr.)
                           For any purpose                          US$ 25,000

            The government allows resident Indians to send upto US$ 25,000 abroad which could be used for any
            purpose including buying shares in the US, Japan, Europe or any other emerging markets such as China
            and Thailand. Indians investing abroad should first verify if India has a signed tax treaty with that country.
            (India has signed tax treaties with 66 countries to avoid double taxation.)

            Source:The Economic Times, Feb 2004.

June 2005                                                                                              THINK INDIA, THINK TIMES
                    100 per cent FDI in Construction
       The government has allowed 100 % foreign direct investment in the
       construction industry in India through the automatic route w.e.f. Feb 2005.

        Minimum area for development relaxed to 25 acres and 50,00sq metres for
       construction development projects (earlier limit was 100 acres and 2000
       dwelling units)
        Minimum US$ 10 mn capital for wholly owned arm
        Minimum US$ 5 mn capital for joint ventures
        FDI projects will be given national treatment on a par with local developers
        Sale of undeveloped land barred
        100% FDI will now be allowed in development of:
        townships
        housing

        built-up infrastructure

        commercial premises

        hotels & resorts

        hospitals

        educational institutions

        recreational facilities

        city and regional level infrastructure

June 2005                                                                      THINK INDIA, THINK TIMES
              Source : Deccan Herald/The Hindu Feb 25, 2005
                                   FOREIGN BUILDERS
            According to estimates, India will need an investment of US$ (2500mn)
            Rs 110,000 crore in urban housing over the next five years. Overseas
            firms need to bring a minimum investment of US$ 5 million.

           Canada based Royal Indian Raj International has plans to invest US$
            3bn(Rs 13,200 crore) in townships in Bangalore.
           Ivanhoe Cambridge is a shopping centre developer and manager.
           Globe Holdings ltd. - New Zealand.
           Crescendo Corporation Bhd – Malaysia.
           Gewoba, Brebau – Germany.

            The foll.US based groups are keen on the property market in India:-

           Calpers – California based
           Chelsea Property Group
           Eamonn Ryan Group
           Hawkins Companies Inc
           HRO International
           Home Properties Inc.
           National Realty & Development Corporation

   Financial Express, May 17th, 2005

June 2005                                                                 THINK INDIA, THINK TIMES
   Changing Lifestyles - Value migration

      •     In the past,
              - there was acceptance of a low standard of living, and that savings were the key to
                 improving these standards
              - Therefore, a frugal lifestyle was understood and accepted
              - Plus, everyone else lived that way too.
              - Plus, the government controlled everything, therefore a person could not just pole-
                 vault into a better lifestyle (except maybe by migration abroad)
      •     The present,
             - Is about abundant opportunity to live a better life
             - Comprising entertainment, connectivity, comfort and style
                  As evident through TV channels, telecommunication, cars, FMCG, and retail
             - And the money to enjoy these with
                  Through improved earning and through easy loans
      •     The future
             - Improvement in middle class lifestyles
             - Through acquisition of consumer durables and new FMGC items
             - Investments will be made in education, technology and housing as a passport to a
                better life

          Source: The Henley Centre
June 2005                                                                          THINK INDIA, THINK TIMES
   Changing lifestyles - Value analysis

     •      Where is value shifting and how
             - Value is shifting from the future to the present
             - From the frugal to the comfortable, aspiring towards lavish
             - From the collective family progress to nuclear family concerns
     •      Impact on lifestyles, behaviour, attitudes
             - Consumerism is in – with excitement and enthusiasm
                  There is some concern about not being able to save, but that is quickly
                    explained away, even if it is only to oneself
                  Yet, a person is not able to accept the idea of complete hedonism and older,
                    more conservative thoughts surface when pushed
             - Attitude and behaviour are in sync with this lifestyle
                     ~ Borrowing is okay, especially for property, education and a better standard of
                     ~ Gets worrisome when loans fund just consumption
                     ~ Each nuclear family has to look out for itself
                     ~ Technology is working in tandem with the individual to make his life more
                          exciting and faster than ever before

June 2005                                                                           THINK INDIA, THINK TIMES
                                     Who can Invest

            Regional diversity results in three socio-economic India's - the
            affluent/well-off, the middle classes and the poor.

            Majority of its population is trapped with low education, low value add
            employment and low income.

            114 mn Indians have managed to break this vicious cycle

June 2005                                                                      THINK INDIA, THINK TIMES
114 million Indians have made it to the high income group

                 Estimates in No of people

                                 99-00 Latest data available*

                                                                With HH earning of Rs. 118,000 per year or more
                             114 Million

                                                                100 millions with potential (SEC AB and C with
                             100 Million                        less than Rs. 72000 pa (NRS 2000))

                             390 Million
                                                                    India trapped in the
                                                                    vicious cycle
                            400 Million

                   Total: 1000+ millions

  *Source: Indian Market Demographic Report, 2002 and THC Analysis.
   The Henley Centre.

 June 2005                                                                                 THINK INDIA, THINK TIMES
       There are 4 mn highly affluent people and 2.1 mn reside in these
           top cities (estimated.) The Times of India Group is well
                           Cities          Share of 4mn
                           Mumbai            253000
                           Kolkata           418000
                           Hyderabad         148500
                           Ahmedabad          99000
                           Chennai            82500
                           Pune               77000
                           Bangalore          71500
                           Lucknow            44000
                           Jaipur             33000
                           Nagpur             33000
                           Surat              27500
                           Vadodara           27500
                           Patna              22000
                           Kanpur             16500
                           Vizag              16500
                           Bhopal             11000
                           Kochi              11000
                           Coimbatore         11000
                           Madurai            11000
                           Trivandrum         11000
*Source: Indian Market     Agra                5500
Demographic Report, 2002   Indore              5500
and THC Analysis - The     Ludhiana            5500
Henley Centre.             Meerut              5500
                           Varanasi            5500

June 2005                                                  THINK INDIA, THINK TIMES
Estimated size of Overseas Indian Community: 23 mn
                              Country                PIOs      Indian Citizens   Total
                              Australia             160000               30000    190000
                              Canada                700000              150000    850000
                              Fiji                  336579                 250    336829
                              France                 55000               10000     65000
                              Guyana                395250                 100    395350
                              Hong Kong              28500               22000     50500
                              Indonesia              50000                5000     55000
                              Italy                  36000               35500     71500
                              Jamaica                60000                1500     61500
                              Kenya                  85000               15000    100000
                              Kuwait                  1000              294000    295000
                              Malaysia             1600000               15000 * 1665000
                              Mauritius             704640               11116    715756
                              Netherlands           200000               15000 ** 217000
                              New Zealand            50000                5000     55000
                              Oman                    1000              311000    312000
                              Portugal               65000                5000     70000
                              Qatar                   1000              130000    131000
                              Reunion Islands       220000                  55    220055
                              Saudi Arabia               -             1500000 1500000
                              Singapore             217000               90000    307000
                              South Africa                                       1000000
                              Tanzania                85000               5000     90000
                              Thailand                70000              15000     85000
                              Trinidad & Tobago      500000                600    500600
                              UAE                     50000             900000    950000
                              UK                                                 1200000
                              USA                                                1678765
                              Yemen                  100000                900    100900

                              *Malaysia includes 50000 stateless
                              **Netherlands includes 2000 stateless

            The table only includes countries where the number of Indians is over 50,000.   THINK INDIA, THINK TIMES
June 2005
            Source : Ishani Duttagupta – TOI Editorial (Indegenius)
                                     Demand for Property in Dubai
            The   UAE, is already a financial hub attracting banking majors offering great services to
            big ticket clients. And if plans fall into place it will soon emerge as a key hub for media.

               Investors in India are looking at Dubai to park their funds.

             In the last few years, Dubai, Ras Al Khaimah and Ajman have opened their doors to
            allow expats to buy and own freehold property in the United Arab Emirates.

            Property    rates in Dubai are comparable with those in Mumbai and Delhi.

            • At the higher end, the cost of a 4 bedroom villa in Palm Islands Jumeirah is $ 567,954
            or Rs 2.50 crores.
            • The cost of a more modest 3 bedroom apartment At Dubai Marina - $ 459,772 or
             Rs 2.02 crore.
            •Sharjah is even more affordable. The cost of a two bedroom apartment -$158,536 or Rs
            69.75 lakhs.

            EminentIndians who’ve invested in Dubai include:
            Shah Rukh Khan – Top Bollywood star, M.F. Hussain – Artist, Sunil Gavaskar – Cricketer

            Source: TheTimes of India / Prices will vary according to location or the real estate promoter.

June 2005                                                                                                     THINK INDIA, THINK TIMES

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