News: 'Indian real estate boom to continue'
(IANS 08/12/2006) Chennai - The boom in the real estate sector in India is likely to continue for the next 10 years, experts said here Friday, cautioning the industry to "behave responsibly".
The real estate industry is currently valued at $12 billion, growing at a rate of 30 percent compound annual growth rate (CAGR), they said.
Speaking at a seminar on emerging trends and opportunities in South India's real estate sector, organised by the Confederation of Indian Industry (CII), Kamalesh Chandra Chakrabarty, CEO and MD of Indian Bank said, "the real estate industry should not become a playground for speculators and go bust."
It is advisable that the serious players have sufficient stake in projects but they should not look for higher returns than what an equity market would offer, he added.
Chakrabarty said that housing and real estate account for 6 percent and 7 percent of GDP respectively, and this "was a good indicator of a maturing economy".
However, the boom will sustain "only when the industry becomes a part of an inclusive growth", he said.
In India, banks had never thought of funding a commercial or residential real estate property a decade or two ago. "However, this has become a legitimate financing activity for the banking industry" today, he said pointing out that real estate boom and retail banking boom go hand in hand across the world.
Listing the bottlenecks, Chakrabarty said that despite ambitious project announcements, the level of deployment is low. "There is a need to improve building efficiency and more focus on creating housing infrastructure for the underprivileged".
"Real estate and construction industry is the second largest employment provider in the country", said Parasu Raman R., chairman, Indian Green Building Council.
The real estate industry is currently valued at $12 billion, growing at a rate of 30 percent compound annual growth rate (CAGR), they said.
Speaking at a seminar on emerging trends and opportunities in South India's real estate sector, organised by the Confederation of Indian Industry (CII), Kamalesh Chandra Chakrabarty, CEO and MD of Indian Bank said, "the real estate industry should not become a playground for speculators and go bust."
It is advisable that the serious players have sufficient stake in projects but they should not look for higher returns than what an equity market would offer, he added.
Chakrabarty said that housing and real estate account for 6 percent and 7 percent of GDP respectively, and this "was a good indicator of a maturing economy".
However, the boom will sustain "only when the industry becomes a part of an inclusive growth", he said.
In India, banks had never thought of funding a commercial or residential real estate property a decade or two ago. "However, this has become a legitimate financing activity for the banking industry" today, he said pointing out that real estate boom and retail banking boom go hand in hand across the world.
Listing the bottlenecks, Chakrabarty said that despite ambitious project announcements, the level of deployment is low. "There is a need to improve building efficiency and more focus on creating housing infrastructure for the underprivileged".
"Real estate and construction industry is the second largest employment provider in the country", said Parasu Raman R., chairman, Indian Green Building Council.
posted by InCar Group Press Room at 23:44
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