The real estate slowdown is underway, blowing away many small and medium scale players like a bowling ball rolling over nine pins. The situation, seemingly, appears grim. With unsold inventory pilling up and even with massive money pumped in advertising, nothing seems to work.
Yet, a silver lining can always be found in examples we shall describe here, but before we do, it is important to understand that changes in consumer preferences, macro-economic realities and market liquidity means small and medium scale businesses of today have to come up with solutions which are grounded in reality.
The top nine real estate developers in India have beaten the downturn, specifically in the housing sector. What is remarkable is that their FY 19 data reveals that they have successfully weathered the slowdown period of FY 2016-17.
Here’s how we can emulate them.
Switching from Premium to Affordable Segments:
With increasing incomes, the middle class segment continues to grow. However, many who enter this class still require affordable homes which they can buy through loans. Smart businesses can capitalize on this. Modi’s Affordable Housing Loan Schemes have made this task much easier.
Complying with RERA:
Serious real estate players should do whatever it takes to create credibility in the market. With RERA as a game changer, customers are on a lookout for a no-holds-barred purchase of affordable homes.
Kick Start Stalled Projects:
If there are any pending projects on paper, then it is time to modify them to the tune of the new reality imposed by buyer choices. These days buyers are wary of real estate firms who’ve taken money and yet haven’t delivered on their promises. Whatever it takes, deliver or perish.
Trim the Debt Burden:
To reduce the debt burden, selling real estate assets or their development rights, acquiring refinancing loans to speed up project completions so as to improve sales or investing in the right kind of advertising is the way to go. The added advantage is that company becomes credit worthy for more loans, if they are needed for future expansion.
Rebrand Your Business for New Buyers:
Consumer culture has now acquired a taste for branding. No longer is branding restricted to electronics or fashion; it now extends to the homes too. That is why advertising must factor this new phenomenon into account. Even though homes are not like FMCG products, but making them stand out from the rest is very important these days when competition is severe.
Vary Your Amenities Mix:
Basic amenities are a must. But a creative real estate developer can introduce other kinds of new services too. So, it is important to understand what buyers are looking for: not just a place to stay but a home to call their own, with like-minded people nearby and where leisure activities find their perfect match.
In these times of uncertainty, it pays to adopt a new approach towards product offering and attracting buyers through trust, timely project execution and long lasting durability. At ESSPEE Group, we believe in these values and we have delivered consistently over the years, beating odds and pessimistic projections.