Indian Real Estate ten years on: The success story continues...

Nostalgia isn’t what it used to be.

Red Ribbon Asset Management adopted cutting edge Impact Investment Strategies more a decade ago at a time when the Indian Real Estate Sector was widely perceived to be basking in its “Golden Age”; and its primary stimulus then was a staggering Rs 150 Billion investment from Dubai. If only things could be so good again…

Well, in fact they are; and they aren’t just as good, they’re better.

In the first six months of 2017 a record Rs 160 Billion poured into the subcontinent’s real estate markets from Dubai: easily eclipsing the 2007 pre-crash figure, even after it is adjusted for inflation and currency fluctuations in the intervening ten years. Because the fact is that things have never been so good in real property investment: right here, right now. Nostalgia isn’t all that it used to be.

Because India’s Real Estate Sector is on a resurgent high at the moment, helped in substantial part by the market friendly policies of Prime Minister Modi’s Government which have made real estate an especially attractive investment. In particular through the introduction earlier this year of The Real Estate (Regulation and Amendment) Act, widely known RERA, as well as last month’s innovative Goods and Service Tax which is widely expected to give a decisive further kick to real estate’s accelerating trajectory.

Anuj Puri, Chairman of the newly launched Anarock Property Consultants had this to say on the subject: “It is worth remembering that with the opening up of FDI (Foreign Direct Investment) in 2006 and institutional investments pouring into the sector over the last 10 years, we have already seen an increased level of transparency. That said, it was evident that more regulation was required and RERA will bring unprecedented levels of discipline and transparency into the sector. The Indian government is committed to bringing in the necessary changes that will help home buyers, investors, the various other industry stakeholders and the sector at large.”

With effect from last week, RERA, developers will be required to provide a five year structural warranty for all new builds. It is the first time that such an ironclad condition has been required from developers where,  earlier, the rule of thumb was that a property buyer was lucky to get any sort of long-term guarantee over a building’s structural soundness. How times have changed.

The innovative Real Estate Investment Trust, Demonetisation with its attendant increased levels of transparency and India’s ongoing focus on Affordable Housing have all added to this trend, helping to create a more mature, consolidated and efficient property market on the subcontinent.

So we shouldn’t expect the flow of funds out of Dubai and elsewhere to be slowing down anytime soon.

Red Ribbon Asset Management has placed Indian Real Estate markets at the heart of its investment strategies since that Golden Age back in 2007. And it continues to do so: it continues to look for cutting edge opportunities in India’s burgeoning real estate market, delivering above market rate returns for its investors and at the same time adhering to Mainstream Impact Investment Strategies.

Given India is the fastest growing Growth Market on the Planet at the moment that is a trend, which is increasingly difficult to ignore.

Read about the Real Estate (Regulation and Amendment) Act here

Read about Indian REIT Legislation and comment.