Business

Why ‘property swap’ is not just an opportunity, but the necessity

A successful business knows that a real opportunity is a necessity. And the true need of the hour is to provide a platform where the potential investors and developers can trade.

COVID-19 is not just a pandemic lethal for human lives but for the economy too. Millions of lives are lost and we are still counting. The economy has seen a major setback and a recession worse than 2008 was speculated.

Having said that, the Indian Real-estate is known to bounce back faster, and turn things into its favour.

After the recession, 2010-2012 are considered the golden years for the real estate sector. The same is anticipated in 2021.

Coming back to the present scenario, ‘property-swap’ is the concept that is barged from the ancient barter-system. Earlier, people used to barter or swap the commodities that were no longer beneficial to them, with useful ones. The trade practices of those times were not limited to one section or vertical.

Now, real-estate has adopted this concept and given it an angle of its own.

Many potential buyers have already invested in the spaces that are either under-construction, or the developers winded up the projects overnight, stating bankruptcy or other reasons. Many are stuck with the assets that are depreciating due to false promises or the projects not being strategically planned.

This has caused chaos, giving potential buyers a sour experience and shrinking the buyer-market.

If we flip the coin and take a look at the developers, there are many genuine, strategically planned, profitable, ready to move-in projects that are still awaiting daylight to shine upon them. Most of these projects are not sold due to the sour experiences and lack of funds for their marketing. They might not be big brands but their architecture is way ahead in terms of interiors and geographical planning.

More than two lakh units in the NCR are stalled with builders unable to deliver the project due to a liquidity crisis.

Gurgaon and Delhi are already developed and equipped, leaving no area for a profitable commercial or residential project to thrive in the competition. These markets are more into ‘Monopoly’ of few big brands which are credible. This has resulted in creating a market where the products are beyond the purchasing power of the middle class and has thus limited potential buyers.

The only thing fixed in our market is change, and if we want to survive in this vertical we need to adapt them and make them profitable for us.

A successful business knows how to convert challenges into opportunities. The higher the risk, greater the returns.

Keeping all these things in mind, ‘property swap’ was introduced and a majority of the people have shown interest in it.

Even big brands are now collaborating with smaller ones, or the individual developers for making it a success. The concept is very simple: If you have an investment that is unused, or not reaping benefits, simply exchange it with a property (Under construction/Ready to move-in) that has an assured ROI, or is more productive and profitable.

Some might say that this is a marketing gimmick, but once the evaluation is done you are surely going to return home satisfied.

It is a great opportunity to revive stalled and stuck investments. Most of the properties sold are ready to move-in projects or are commercial spaces with an assured lease guarantee.

Not just the commercial market, even if we take a look at the residential side of the market, it is a good opportunity for home buyers as well.

There are already numerous options for ready to move-in projects and the home loan rates have now been revised to 6.75% from 8.75% earlier this year.

A general misconception keeping home buyers away from investing is that during an economic crunch or recession for say, COVID-19 pandemic or demonetization, the real-estate would face a setback and the property prices would go down, but this is not the scenario. Investments in real estate are the most secure with capital protection yielding higher returns.

The major challenge faced by real estate right now is lack of trust and the investors being hesitant in re-investing.

Property swap in the current scenario will not just help in creating jobs but will also pump the money back into the economy. This eventually will help in winning back the trust of investors by helping them realise that these kinds of transactions will yield good returns.

All we need to do is create a proper structure for the current market to correct the property prices.

If we pay close attention to the stats, in the top 8 cities, on an average, 0.6 million homes are demanded each year, whereas the supply is offering only 0.2 million units. There is a huge gap between the supply and demand in urban housing.

Whereas in the LIG and EWS category the demand is of 0.34 million but the availability is of the ticket size 2.5 million.

Clearly, there are shortcomings in our structures that are eventually resulting in a shortage of affordable housing. The main factors contributing in this; unavailability of land in the urban areas which makes the procedure of affordable housing long-winded.

Noida being the closest destination from Delhi, the majority of the projects have come up here, near Expressways and highways.

Companies like Oracle, Accenture MetLife, Cognizant, NIIT, Genpact, Birla soft, Samsung, KPMG, VIVO are a few of the MNCs that have already established their offices in Noida.

Talking about basic facilities like the hospitals & the education sector, universities like Amity, Sharda, Galgotias, Noida International Gautam Buddha University are some of the names from a pool of colleges and universities in the knowledge parks of Noida.

The job opportunities here are expanding which attracts a major footfall. You can see architectural marvels in NCR.

The return of investment is very high and sustainable. The cherry on the cake is the infrastructure that is far better in comparison to Delhi and Gurgaon.

Also, the demographics here are expanding and the footfall is still growing every day.

Going by the experience and numbers, it is high time to swap properties and invest in something that will be adding to your portfolio in longer runs.

Dead investments are like skeletons that will never breathe.

Why not add a little amount to it and get something that will stay forever. There is no harm in taking risks for a tried and tested profitable campaign. Every real-estate mammoth is doing this, then why stay behind.

Do thorough research, visit the site, meet the developer, understand the project, do due diligence and then invest.

This is the time to invest and grab the opportunity.

 

Khurrum Zahoor is the CEO & Co-Founder of Alif Realty. 

Views and opinions expressed in this article are those of the author’s and do not necessarily reflect the editorial position and policy of Free Press Kashmir.  

 

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