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Real Estate Market in Eastern Region – Stable for Investment By P. B. Roy, RM, LIC Housing Finance Ltd., Eastern Region

In 2013, Indian Economy witnessed an economic slowdown with lower GDP growth. Despite best efforts made by the economists and policy makers, the overall “India growth stray” seemed to decelerate with many sectors showing negative or slow growth. The poor economic sentiments griping the country and negatively affected the Indian residential real estate market. Developers are facing the twin impact of financial crunch and a rising unsold inventory. Weak economic growth and rising inflationary pressure influencing the home buyers maintained a cautious approach. Amidst challenging market conditions and declining demand, now many developers restored to repacking their projects by offering smaller sized units to make the overall ticket sizes more affordable. Further, to incentivize buyers they offer many financial benefits to the customers to make it more attractive and affordable. There are demand supply imbalances across the region. In many places the high end segment prices have declined upto 5 to 10 percent, however, in the mid segment it is witnessed and appreciation of 15-20% due to its inherent demand. Going forward, in 2014, with an improvement in both global and domestic economic conditions and hopefully with a stable political environment real estate market is likely to perform better. In Eastern India real estate prices are far more realistic compare to cities like Mumbai, Bangalore, Hyderabad or Delhi, there is more scope for further growth.
Scenario of top cities in Eastern Region is given below:


Buying property in Kolkata is no more a hassle as many new residential projects have come up where one can find flats at both reasonable and expensive rates.

There are a varied range of flats available in Kolkata; some of them are studio apartments, 1, 2 and 3 bedroom apartments, the rates also vary accordingly. A person who wants to stay alone and does not want to invest much on a home can live in studio apartments.1–3 bedroom flats are also available in Kolkata. Depending on one’s spending capacity one can select from the wide variety of flats.

Kolkata market seems to be very vibrant and growing. Kolkata real estate prices are far more realistic compared to other tier-I cities like Mumbai, Delhi, Bangalore or Hyderabad. So in a sense there is more scope for growth here.

Real estate has always been an attractive investment. It is not a short-term investment but a long-term one. Prices in Kolkata, on the other hand, have been very steady in the last two decades. Kolkata is a far more stable market for an investor. There are some pockets in Central Kolkata but not too many projects are happening here due to the non- availability of large plots of land. The forthcoming metro lines in the city have had a positive effect on the minds of the people and therefore places like Salt Lake, Garia and many others have been witness to appreciation on the real estate front. Further, there has always been a persistent demand for properties in the central areas of Kolkata since no new projects have been forthcoming. This has therefore maintained a situation wherein there is always a consistent demand for land in the city of Kolkata.

In spite of the global economic meltdown, national meltdown, the end users of realty are still flocking the projects in search of a perfect home. This trend is very much visible and palpable in Kolkata also. With this current trend in view, the real estate developers of Kolkata have shed their inhibitions of getting into low cost homes and are open now to invest in lands which are even beyond the boundary of the city of Kolkata.
The real estate economic growth only survives on the comfortability of all the classes of people in a society and what drive them are the infrastructure facilities.
So, when it comes to transportation and communication, Kolkata has surpassed all the other metros in India and has improved many folds, paving way for its real estate developers to even think of building homes in areas which are not very close to its city centres. Hence, very good homes have mushroomed now in the various suburban areas of Kolkata with affordable prices keeping in view the low land cost of those areas, various commuting facilities, economic crunch overall, giving a chance to anybody to invest in those areas. So, this is probably the best time to invest in a Kolkata property. Not only because, the prices are low due to the above factors, also because even in an economic meltdown, property investments are always a safer option.

Also, in recent times, the Kolkata developers have followed the models of Mumbai, Chennai and Bangalore, and have come up with various offers for their properties namely offering free mid-sized cars to the first few buyers, modular kitchens and free Air-conditioners with flats which are difficult to sell due to their design patterns etc.

In this atmosphere, the highest number of buyers that Kolkata is getting is either from the NRI Indians or from people who reside in nearby cities who are making a safe bet here. The demand for home in Kolkata is increasing as a result.

The city endowed with all the basic features essential for growth, has prompted realtors, from all over the country, to launch their projects in the city. The city’s growth can be attributed to rising investments across industries including IT, rapid industrialization and opportunities arising out of it and improvement in infrastructure and urban governance.

his apart, major IT giants are setting up their operational base in Bhubaneswar while the education sector has also been experiencing a major boost with the city being home to top-notch educational institutions like IIT, KIIT, XIMB and many more.

This apart, even in the healthcare sector, Bhubaneswar has witnessed a considerable improvement with modern medical facilities being offered by renowned names like Apollo, Kalinga, AIIMS, Asian Heart Institute and some more. In other words, the city can well be termed as a one-stop luxury destination in the State that attracts investors in large number to the city.

Investing in property in Bhubaneswar is a dream investment as many residential projects are coming up in this happening city. The demand for properties has spread across many different categories such as separate residential houses, apartments with multiple floors and villas and it is not limited to a particular category.

With an upward movement in commercial as well as residential properties, the real estate scenario in Bhubaneswar presents a rosy picture. To entice more and more buyers, builders in this part of the country are coming up with newer and newer projects in Orissa. Bhubaneswar has come forth as the most favored city because of its strategic position for trans-national companies. Seeing a flourish in its real estate business, the demand for all kinds of properties in Bhubaneswar has been mounting.

The real estate sector in Bhubaneswar is getting bigger and better with every passing day with the face of the city completely changed thanks to development of residential townships, malls, office spaces, flyovers and road improvements.

This infrastructural change has made the city one of the fastest growing tier II cities in the country, and also a realty hotspot for investors today. Bhubaneswar is proving to be an ideal city for buying residential and commercial property because of availability of excellent infrastructure and all the basic facilities.

Bhubaneswar realty segment is more consumer-driven and the realtors are launching according to the prevailing demand and need. The construction activities of new real estate projects have pushed property prices to new heights. The real estate scenario of Bhubaneswar is thus very notable and is likely to increase in the near future.


While Patna realty sector was on a high, the other parts of Bihar have been slow on the uptake largely because of lack of developed infrastructure needed to support the realty sectors growth. Things are slowly changing and growth in real estate segment is picking up in other towns as well. For example, Bhagalpur is witnessing development of both residential apartments and commercial space. Other towns like Muzaffarpur, Gaya and Purnia they too have caught the fancy of realtors.

In a way, Patna has already become a metropolis. But, it still does not have the infrastructure one normally associates with metro towns. The per square feet price of residential apartment or commercial complexes in Patna is nearly at par with that prevailing in Delhi or other big towns of the country. But, if one wants to categorise Patna as a metropolis, it needs to have better infrastructure by way of roads, power, water and sewerage systems.

The company offers various range of products, our major schemes are:
Griha Vikas

Purpose: For Children’s Education/Marriage, Foreign Travel, Purchase of another Property, Business Expansion, Purchase of Consumer Durables/Vehicles, etc.

Min. Loan Rs. 2.00 Lacs. Max. Rs.50 Lacs

Loan amount : 60% of Property Value.

Loan Term : 15 years.

Rate of interest : 12.50 %

 Property has to be Self-occupied Residential Property.
The IInd house can be purchased(if title is not clear) by availing mortgage loan under this scheme with attractive rate of interest.

Rental Securitization
Purpose: Financing of commercial/residential properties against future rent receivables
Minimum Loan Rs. 10.00 Lacs.
Maximum Loan is lowest of following:

80% of Net Rent

ii) Loan Amount not to exceed 90% of Net Rent.

iii) 60% of property value
Loan Term: Max.10 years.
Multi option repayment scheme: PDC/ECS/Direct remittance by tenant
Property must have been let out to PSUs/ Central / State Govt. Undertakings, Banks and Financial Institutions or reputed Corporate.

Advantages of this scheme:

Loan repayment will be by the tenant and not by the owner

Repayment will be through rent

Longer repayment period

Loan can be availed for purchase of another property

New Griha Lakshmi

Purpose: Laos to individuals against liquid security such as LIC policies, FD, NSC/KVP for purchase/construction/extension/repair & renovation of residential property/mortgage loan/ construction of clinics or office premises.

Loan quantum: 95% of surrender value of policies or face value of NSC/KVP/FD.

Term: Max. 20 years


A) Construction Finance- Sales Model: Under this scheme financial assistance is provided for Construction/Development of specific project (can be residential as well as commercial) for the purpose of sale. Main security for the loan will be project land and construction thereon. Loan amount will be released in instalments depending upon the progress of construction, request from the Borrower and available of sufficient security cover. Repayment of loan will be from the sale proceeds of the project and/or from own sources.

Lease Rent Discounting: Under this scheme financial assistance is provided against discounting of future rent receivables from the property, the construction of which is completed and the property is either already given on lease or lease agreement with the tenants are finalized. Repayment of loan will be in form of EMI payable from diversion of rentals through Escrow Account.

SANCHAY: (Public Deposit Scheme)
It is a FAAA/STABLE rating by CRISIL. It is a deposit scheme for resident individuals, Limited/Private Limited Companies, NRI, Co-Op. societies and Associate of Persons. The interest rate is as follows:
Term Interest Rate
Sr. Citizens:
Deposit upto 50000/-
(ROI P.A.)
Sr. Citizens:
Deposit above 51000/- & above
(ROI P.A.)
1 Year 9.00% 9.10% 9.25%
18 Months 9.00% 9.10% 9.25%
2 Years
9.25% 9.35% 9.50%
3 years
9.40% 9.50% 9.65%
5 Years
9.60% 9.70% 9.85%

The company has been growing steadily since inception. The strength of the company is adequately reflected by the fact that CRISIL has rated the company’s debt instruments AAA for a decade, indicating highest-level of safety.

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