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Why no one is now talking about Affordable Housing ?

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  Why no one is now talking about Affordable Housing ? During 2010, every other media articles in real estate would talk of the need to push Affordable Housing. Suddenly that noise is conspicuous by its absence.                                                                     -------     -------     -------   -------     -------            Here are two news items from NCR real estate …   ·        In just 72 hours, DLF sells 1100 luxury apartments priced at an average Rs 7 cr    ·        At about one-tenth of this prices, Affordable Housing units of    DDA struggle to find buyers.        Interestingly, other sectors too are showing a similar trend :        Mercedes Benz sees an all time high sales in 2023 and entry-level cars are seeing negative growth         An “almost nil” growth in entry-level smartphone, while premium smartphone sales are seeing  50%                 plus    growth.     Across many consumer markets, the marketers are increasingly seeing far more growth in the pre

Safeguarding Indian Realty from Evergrande phenomenon

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      Safeguarding Indian Realty from Evergrande phenomenon     All published in The Print   While the above issue does raise concern, however,  before one addresses the above, a more fundamental question needs to be answered : “Why do developers end up borrowing more than they can chew ?”   And the answer lies in the structural uniqueness of real estate business.     1.       Capital requirement remains unpredictable     A developer typically plans his funding through three sources :   ·        Own equity ·        Borrowings from banks etc. ·        Customer Advances      Owner’s equity has physical limitation, bank borrowings too are limited by regulatory norms. Since customer advances remain unpredictable, financial closure quite often remains a puzzle.  Further when  the projects gets completed, developer’s capital requirement comes down significantly, therefore, developer would prefer capital that can be repaid after the project.    To address all the above concerns, developers en

Telecom and Real Estate : A strange case of similarities

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Telecom and Real Estate : A strange case of similarities     अति रूपेण वै सीता चातिगर्वेण रावणः। अतिदानाद् बलिर्बद्धो ह्यति सर्वत्र वर्जयेत्।।     Extreme beauty of Sita,  Extreme haughtiness of Ravana,  Extreme charity of Bali  were the cause of their troubles.  Therefore, extreme is prohibited everywhere.     ~ Chanakya Neeti (Chapter 3, Shloka 13    )     The summary of the above i.e.  Ati Sarvatra Varjayet    (extreme is prohibited everywhere), has brought two sectors with no commonalities – Telecom and Real Estate – on the same table. The differences among these are, of course, very obvious. The former, being technology driven, represents the modern and experiences things moving at the speed of light    Real Estate represents the old and is slow in reacting to events. If Telecom costs are about a small monthly charge and Real Estate purchase is about biggest expenditure in one’s life. Differences are so much palpable that according to a few analysts the two are set at cross purpos