In some cities like Visakhapatnam we are already seeing vertical growth in the form of high-rise buildings.
In some cities like Visakhapatnam we are already seeing vertical growth in the form of high-rise buildings.
Tier II and Tier III cities have immense potential for real estate growth and therefore developers should shift their focus to these cities now, said G. Ram Reddy, national vice president of CREDAI.
He was addressing Tuesday along with other officials at a press conference at the upcoming New India Summit (NIS) to be held in Visakhapatnam on April 29-30.
He said this summit is one of the three key annual events of CREDAI and this is the fourth edition.
Due to the COVID-19 pandemic, it was last held in 2019 and this time will be hosted by the CREDAI Visakhapatnam Chapter.
The theme of the summit is ‘Cruise: Navigate the future’ and will essentially focus on real estate opportunities in Tier II and Tier III cities. The idea is to train builders to boost real estate growth in these cities on par with metropolitan cities, said B. Raja Srinivas, President of CREDAI-AP
On the benefits of these cities, Mr. Reddy said, “CREDAI has a presence in about 200 Tier II, III and IV cities with about 14,000 members and at this summit we want to raise awareness about the leverage factor. In some cities like Visakhapatnam, we are already seeing vertical growth in the form of high-rise buildings.”
As for the advantages of these cities, he said that primarily land is available and prices are much cheaper. “Additionally, with the catching-up work-from-home concept, funds are available and people are stepping up to invest in these cities. Cities have all the assets, including good internet facilities, and all we have to do is exploit the potential,” he said.
Speaking about the issues in these cities, Mr. Reddy said there is a need to create awareness of branding, digital marketing, feasibility of finance like bank loans and technology among all stakeholders such as builders, buyers and financial institutions.
According to him, infrastructure projects such as PM Gati Shakti, roads, special economic zones and industrial corridors will have a positive impact on real estate in these cities. “The more infrastructure grows, the greater the real estate growth will be,” he said.
Speaking about the problems facing the real estate sector in the wake of COVID-19, he said that the upward spiral in prices has become a major factor in all ingredients like steel, sand and cement.
On the one hand, the rates have doubled and on the other hand, we cannot increase the price already agreed with the buyer. This drastically reduced the profit margin and many projects across the country had to be halted midway.
After COVID-19, it is the Russia-Ukraine crisis that is raising prices and we cannot find a break from the price hike, he said.
With this in mind, CREDAI is now seriously considering adding the escalation clause to the contract and accelerating the proposal to reduce GST input tax to the Union government, said Mr. Reddy.
Organizer Dharmender Varada gave details of the NIS, saying about 1,000 delegates from 20 countries are expected to attend.
The two-day summit will consist of around eight sessions and will cover various aspects such as infrastructure building, new technologies and alternative materials, brand building, digital marketing and digital technology.
He said that the CM has been invited to the opening, but there is no confirmation yet. Experts and inspirational speakers will also speak at the two-day event.
