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INTRODUCTION REAL ESTATE: The term real estate is defined as land, including the air above it and the

group below it. and any building or structure on it is also referred to as realty. It covers residential housing, commercial offices, and trading spaces such as theater, hotels, and restaurant retail outlets, industrial buildings such as factories and government buildings. Real estate involves the purchase, sale and development of land, residential and non-residential buildings. The main players in the real estate market are the landlords, developers, builders, real estate agents, tenants, buyers etc. The activities of the real estate sector encompass the housing and construction sectors also. The real estate sector in India has assumed growing importance with the liberalization of the economy. The consequent increase in business opportunities and migration of die labor force has, in turn, increased the demand for commercial and housing space, especially rental housing. Developments in the real estate sector are being influenced by the developments in the retail, hospitality and entertainment (e.g.: Hotels, resorts, cinema theater) industries, economies services and information technology (IT) enabled services etc. The real estate sector is a major employment driver, being the second largest employer next only to agriculture. This is because of the chain of backward and forward linkage diat the sector has with the other sectors of economy, especially with the housing, construction and commercial sector. About 250 ancillary industries such as cement, steel, brick, timber, building material etc are dependent on the real estate industry.

REAL ESTATE IS A GROWING SECTOR IN INDIA Real estate in India will continue to rock. Profound economic suggest that the realty sector would grow at 30% per annum to reach to $45 to 50 billion by 2010 from the existing $I- billion. To achieve this growth real estate in India would require huge investments over the next five years. By 2015 it is projected that the market size would grow to $ 90 billion. Estimated suggest that the urban housing sector would require investments to the tune of $25 billion (Rs 1.10 lakh crore) over the next five years. Prices have remained buoyant as new construction lags. According to surveys there is a shortage of 19.4 million units (12.7 million units in rural areas and 6.7 million units in urban areas) in the country about three years ago, which will require real estate in India. Real estate in India will trigger economic growth infrastructure development and enabling government policies would help trigger growth. Real estate-in India will help high economic growth has fuelled the demand for real estate. Cities continue to attract interest from IT and ITES companies that are either establishing a base or are looking to expand which will give rise to real estate developer in India. It is the suburban locations that are witnessing development activity due to easier availability of land construction of large floor plate and offer of built to suit facilities thus helping housing construction company in India. According to one estimate the IT and ITES sector are creating 200.000 jobs per annum which itself will create a demand in commercial space of 15 million square feet. Besides it will generate a huge demand for residential flats. So more need for luxury residential apartments in India. Real estate in India assumes that 25 % of the work force joining the IT/ITES sector required independent housing there would be demand for 50 million sq ft of residential accommodation every year to meet the need of the workforce joining the IT/ITES sector alone. The demand has been aided by the ease in documentation and formality of property registration in India. It leads to boost

property developer in India. The Indian realty sector would see unchanged interest from N R Is aided by the relaxation in FDI norms in real estate. The government has also helped by permitting banks to advance home loans to N R Is. The report acknowledges that the government had also played a pivotal role in the development of this sector. It had aided the sector by giving income tax benefits to consumer and benefits to developers, it initiated the rationalization of stamp duty and repealed the Urban Land Ceiling Act in 9 states. A number of state governments are moving towards computerization of land records. Real estate in India has a bright future .The report also pointed out certain issues, which need to be addressed by the government to ensure rapid growth. Some of the issues are absence of large listed companies in these sectors, which has affected fund flow. Foreign still cannot buy or sell undeveloped land, and reassessment of the legal aspect to stamp duty and rent control. At last, changing demographics, low interest rate regime, rising disposable income, and fiscal incentives have provided huge demand for housing. Further nuclearization of Indian families has accelerate the demand for mortgages and for fresh housing thus give rise to mnre real estate developer in India. Political reforms in relation to real estate: The government is quite rational when il comes to infrastructure and development in the country as it is required to achieve and maintain a growth rate for the economy. The real estate sector being directly related to it, is being given due importance. The government has made suitable amendments in the FDI regulations, taxation structures and various land acts in order to attract more foreign investment into the country. Economic factors: The lower interest rates and ease of credit availability is fueling the demand for real estate in the country. This scenario coupled with the huge potential for consumer credit penetration in India is favoring the real estate sector. Demographic factors: Demographic factors like increasing literacy rates, higher disposable incomes, and increasing urbanization in the country are

important factors propelling the demand for real estate in the country. The above factors are going to generate huge demand for residential space, which comprises 80% of the total real estate demand in the country. PRESENT SCENARIO OF REAL ESTATE IN INDIA The real sector in India today witnesses a wide spectrum of changes that slowly but surely is expected to make India in to a preferred destination for real estate activity. The real estate market in India is opening up. There are still some barriers to real estate development like unclear titles, tenancy reforms and low property taxes. Two major steps taken by the Government will however be key catalyst in fueling growth in real estate sector m INDIA. Now with reputed builders like DL, ANSAL API etc and international property consultants joining the fray, this image has strengthened and evolves into a professional corporate image. Recent moves to allow I0Q% Foreign Direct Investment in India, FDI would be in integrated township which would include housing, commercial premises, hotels and resorts, while the urban infrastructure would comprise roads and bridges mass rapid transit system and manufacture of building material. The minimum average that can be developed is 100 acres designed keeping into consideration the local byelaws and regulations. FDI is not allowed in retail sector. Currently, real estate prices have stabilizes to a great deal as a role played by speculation has started declining. There a lot of change being introduce in the Indian real estate sector especially with the cheap labor, pool of people. Other major event is the introduction of real Estate Investment Trust (RE1T). Currently mutual fund are not allowed to have direct exposure in real estate but can make debt and equity investment in the company. The Indian version of REIT-REIS (Real estate investment scheme) would enable investment by small investors in the real estate sector and thus earn dividends on the rental income being paid. The fiscal incentives introduce by government introduce 3 years ago have unleashed the market forces. The credit of housing has gone up and interest rates have come down to 8-9% average. With fiscal incentives and

factoring inflation the real interest rates on housing loans is very less. This has brought in a sea change in the profile of the home purchaser across the spectrum. The average age of the home buying customer has been drastically reduced. It has been found that young working people in early and mid 20 also buying residential flats. The other major changes witnesses in the reaJ estate industry currently are the reorganization of country status itself. The Government of India has made it mandatory that 3% of the incremental deposits of the banks would be deployed to the housing industry. Today real estate office market is booming IT AND ITEs segment. With lower operating costs being the driver office property have moved from Central Business Districts to suburbs to Class I cities and this market is continue to expand in Tier II and tier III cities. Real estate sector is still facing the main problem of high stamp duty in Indian states. These range in most Indian cities between 10% to 15% Some states even have double stamp incidence first on land and then on its developments even National Housing and Habitat Policy 1998 recommend stamp duty of 2-3%. Its needed to be reduced by caking the recommendation into consideration which is mentioned in the report otherwise this increasing rates of stamp duty and land cost will give rise to parallel economy which lead to huge loss of government revenue. FUTURE SCENARIO OF REAL ESTATE IN INDIA In future the real estate sector will be in very good shape as the demand for both residential and non-residential property is increasing and in future more houses need to be developed in urban and rural areas as census of 2001 indicates that urbanization rate of 27.78% is expected to go up to 41%(550 million) in the next 20 years (population 202l).However, Indian government of 1350 million by Habitat Policy(NHHP) envisages that

by the year 2012 the housing shortage should be removed and everybody should have a house of his own and to meet this target the estimated investment involved is approximately Rs. 400000 crore or say US $800 billion by 2012.hi future the demand for real estate will likely to touch aroundl055 million sq ft

by 2010 and by this date capital requirement will have bloated to $68 billion and market will require $ 30-40 billion more in future with most companies tying up their expansion plan. The C&W says urban India alone require 12 million housing units with scope of 400 townships in 5 years across 30-35 cities each with 5 lakh population and Indian has potential to grow to those levels as FDI flows into more land intensive sector like retail and manufacturing as there is a shortage of 20 million housing units till 2010.Cushman& Wake field says smaller towns like Patna, Surat, Luklinow. Coimbatore, Vijayawada etc have immense potential in commercial and residential sector and by 2015 there will be 45 such cities from 25 odd cities. The US alone committed S 2 billion for Indian real estate over next 18-30 months, In real estate sector 23 million sq ft of new space came in to market with additional 50 million sq ft expected by 2009. AMAZING BOOM IN COMMERCIAL SECTOR: Future of commercial sector is boom. There is a great demand for office building in India. The demand for new office space alone has grown from estimated 3.9 million sq ft in 1988 to over 16 million sq ft in 20045.Cumulative demand for office space in India between 2005-2008 is estimated to be in excess of 85 million sq ft. This represent annual growth rate of 14.5% over the next 3 years or approx.20 million sq ft/year and approx 80% of demand is created by IT AND BPO sector. ITES & BPO segment register a growth of 54%. NASSCOM & Mckinsey study has predicted that I T Es sector in India will provide additional job for over 1.1 million people by 2008. which translate into space requirement of approx. 100 million sq.ft. Retail is considered the world largest private industry with total sales of over US $ 6.6 trillion with close to 12 million outlets. India has die largest retail density in the world .It is estimated that presently additional 46 million square feet for malls, multiplex is being added in India out of which 32 million sq ft is spread over across 7 major cities. In future 45 malls with over 9.5 million sq ft of retail real estate is expected to come up in Tier II cities like Jaipur, Chandigarh, Ludhiana,

Nagpur, Baroda, Kochi etc by end of2007.lt is expected that government will soon permit FDI in retail and this would further increase the demand for shopping malls, multiplex etc. However opening up of FDI in retail trading will not necessarily cause rent to rise as their demand will be offset by additional stock. Spiraling land prices (sign of overheating and excessive speculation): The land prices have really shot up in the last 2-3 years. Builders continue to get enough buyers for whatever absurd prices they quote. Now, that is a very strange thing when seen in the Indian market perspective. India is a very pricesensitive market, Whatever you sell you have to give the consumer a good value for money. So, when such people make a beeline for things priced exorbitantly, there may be large amounts of speculative investment money entering the market. Also, people now assume that property prices moving up is a sure thing. There is nothing called a sure thing in investing and this is a sign of overheatmg. Uneven price growth: Prices of real estate across the country, or even within cities, will have their own unique demand and supply factors. This needs to be understood in detail. A number of transactions and also corporate land bank values are ignoring this basic tenet of real estate investing. Questioning the capability to deliver: Although there have been huge plans of development in all the areas of real estate development whether residential, commercial, office, retail or SEZ. various questions have been raised on the execution capability of the developers in delivering The promised product within the specified time period. Oversupply: With the real estate story getting big in India, major plans arc afoot for various types of real estate developments in big cities and small towns. There have been concerns of an oversupply situation arising 2-3 years from now. Still unorganized: India's property market remains unorganized and

underdeveloped. This creates risk for investors, in the absence of a clear title to property, the risk of litigation is high. For those foreigners who invest in India via real estate investment trusts, there are no rules on the marking of their stakes to market or on whether they must pay stamp duty on transactions. Relation to the stock market: The true origin of this bubble-like situation may be traced to the stock market boom. The Indian stock market has been witnessing a nonstop bull run for an unusually long time. During the last couple of years, share prices have surpassed all expectations. The present situation can be compared to Japan's real estate crash in 1 991. Prior to the crash, both the stock market and the properly market were on fire. Profits from the stock markets used to be transferred to the property market and vice versa. The same thing is happening in India as well.

OBJECTIVE OF THE STUDY To find out the reasons for transition of people from Delhi to National Capital Region (NCR). To find out the perception of people about the cities included in NCR namely Gurgaon. Noida, Greater Noida, Faridabad and Ghaziabad To know the degree of importance of various factors which people consider while purchasing a house.

RESEARCH METHODOLOGY SAMPLING METHOD Stratified method of sampling was used for face-to-face survey while snowball sampling method was used while conducting telephonic survey. SAMPLE SIZE People living in Gurgaon Housing and Society Complexes, in Noida housing complexes and in Ghaziabad (Indirapuram) Housing complexes were surveyed. Total Number of people sun-eyed was: Gurgaon Housing Complex Gurgaon Society Complex Noida Housing Complex Ghaziabad Housing Complex ------------------446 ------Sales Manager of 25 under-construction Housing Complexes were also surveyed to know the degree of importance of various factors that people consider while purchasing property, from developer's viewpoint. ----200 40 56 150

DATA COLLECTION METHOD Data was collected by using primary as well as secondary methods of data collection. PRIMARY METHOD 1) Face to Face interview 2) Questionnaires 3) Telephonic Survey 4) Survey through E-Mail 5) Survey through Reference SECONDARY METHOD 1) Magazines on Property 2) Internet sites on Property 3) Internet websites of popular property developers of India PROBLEMS ENCOUNTERED DURING THE SURVEY Denial of permission to conduct survey in PVR shopping mall and few housing complexes like DLF Belvedere Park, Ansals Sushant Lok. etc. TRAVELLING TO FAR-OFF PLACES FROM DELHI EVERYDAY. Analyzing the perception of people about different cities of NCR was little difficult as some respondents didn't have much knowledge about Ghaziabad and Faridabad. FACTORS AND PARAMETERS CHOSEN FOR SURVEY The questionnaire was prepared in such a way so as to achieve all the three objectives mentioned above, hi order to attain the objectives five major questions were included in the questionnaire along with few general questions. In order to achieve the first objective of finding out the reasons responsible for

transition from Delhi to NCR two questions were included. One to find out the first pull that attracts the people most while buying the property (See Ql of Housing Questionnaire given in Annexure 1). And the second question helps in finding out other major reasons for purchasing the property (See Q6 of Housing Questionnaire given in Annexure 1) FACTORS WERE 1. Brand name - Brand name is something that immediately comes into your mind when you think of any product. Even in case of purchase of property, brand name plays a major role. Many people to prefer buy the property developed by well-known and reliable developers. Moreover properties developed by established developers help buyers in getting the best returns, as these properties can be sold any time at a premium. 2. Advertisements - Its an old belief that advertisement can sell literally anything. In order to ascertain whether its true for property or not, it was also included as a first pull factor in the questionnaire. 3. Location - This deals with property and connectivity to road links, airports, railway stations and bus stops. The more approachable the property is to the public transport terminal, the more value it holds. Proximity to the Central Business District also plays an important role in this aspect. 4. Affordability - Budget plays an important role in short listing the options available in the market. Its only when the budget is decided, one starts looking for the available options in the price range decided. SOME OTHER FACTORS WERE: 1. Need for More Space 2. Need for Better facilities 3. Need for Healthy environment 4. Want for Quality Construction

5- Lack of facilities in previous residence 6. Proximity to Workplace 7. Job transfer In order to achieve the second objective of knowing the perception of people about cities included in NCR a question related to it was included in the questionnaire (See Q13 of Housing Questionnaire gi\en in annexure 1). PARAMETERS WERE 1. Location - This parameter includes all the locational factors such as proximity to central business district, to schools, to hospitals, existence of huge shopping malls, etc. 2. Business Hub - This parameters helps in analyzing the perception that people have about the job opportunities and business prospects available in different cities included in NCR. 3. Quality of Living - This parameter helps in analyzing what people think about the style of living prevalent in the 5 cities included in NCR. 4. Law and Order - This parameter helps in analyzing what people about the safety and security situation prevalent in the 5 cities chosen for the survey, 5. Infrastructual Development This parameter helps in

analyzing how respondents rate 5 different cities chosen for the survey, on the basis of conditions of road and highways, availability of public transport, etc. In order to achieve the third objective of knowing the degree of importance of various factors, which people consider while purchasing the property, two questions were included in the questionnaire. One to find the degree of importance of external factors (See Q2 of Housing Questionnaire given in annexure 1) and another to find the degree of importance of in-locality factors

(See Q3 of Housing questionnaire given in annexure L).

FACTORS WERE EXTERNAL FACTORS 1. Price Range 2,Connectivity to Public transport 3. Proximity to workplace 4. Availability of loan 5. Easy Payment Plans 6. Rate of Interest 7. Resale Value 8. Clear title of property 9. Proximity to School 10. Proximity to Hospitals 11. Proximity to Entertainment Centers IN LOCALITY FACTORS 1. Peaceful Locality 2. Pollution Free environment 3. Population/occupancy 4. Quality of Construction 5. Maintenance 6. Suitability of Home Type 7. Utilization of space 8. Water Availability 9. Power Backup 10. Safety-Security 11. Recreational facilities/Sports Complex 12. Car Parking facility 13. Club Membership

DATA ANALYSIS MAJOR PLAYERS OF REAL ESTATE MARKET IN DELHI UNITECH LIMITED Unitech is the largest listed real estate company in India with a market capitalization of over US$ 5bn, It operates in India and exports engineered construction products to the Middle East. Unitech was among the first players to enter organized infrastructure development. Unitech works closely with various state governments to develop SEZs across the country'. New Kolkata International development project is one of the largest infrastructure development project undertaken in the country. Unitech has tied up with International Amusement to create "E-city" in Noida. Its business strategy is to build a Pan-India presence while maintaining a leadership position in each city of India. DLF UNIVERSAL LIMITED DLF is a leading player in Indian real estate industry' with six decades of experience. Since its establishment in 1946, it has developed 21 urban colonies aggregating 5,816 acres, as well as an entire integrated 3,000-acre township which is popular as DLF City. Future projects include development of 100,000 acres over the next few years and it aims to become the single largest real estate company in the country. ANSAL PROPERTIES & INFRASTRUCTURE LIMITED Ansal Properties & Infrastructure Limited (APIL). one of the major players in real estate industry, is promoted by the Delhi-based Ansal Group engaged in civil construction and real estate development in India and overseas. In March 2006, APIL tied up with Malaysia-based facilities management company Faber Group Berhad in a joint venture to foray into healthcare facilities management. HDFC realty bought 33% of Ansal SPV. APIL has big plans to invest

Rs.30,000 cr in the next 3-4 years to build 16 townships. As the focus on infrastructure development by the government has been strengthening, growth prospects of Indian real estate sector looks bright. A study by housing development finance reveals that India is short of 20 million housing units. Deutsche Bank researchers forecast that by 2030 India will need up to 10 million new housing units per year. Another driving factor for the industry is SEZs, which come with tax exemptions like 10-year corporate tax holiday. Besides this, the fifth most attractive market in the world, the retail market of India, has also been contributing significantly on a large scale for the growth of the sector. Leading national and global players have big plans to invest in the infrastructure and construction of the retailing business. All these positive signals indicate that there is huge growth potential for the real estate industry. Joint ventures and consolidations will become the order of the day in realty space. However, there are challenges like fragmented industry with less transparency and high transaction costs. The condition can be improved with the increase in the professionalism of the industry and flow of organized money into the sector. Given its huge growth potential, real estate can be vindicated as the best investment avenue for long-term investors. The following is the overall assessment about the real estate industry in IndiaReal estate sector is a major contributor to GDP (Gross domestic product of India), over the last decade, the average household income in urban areas has grown at a CAGR of 5%. According to estimates. 80% of the real estate developed in India is residential space and the remaining 20% comprises of offices, shopping malls, restaurants and hospitals. According to the 10th Five Year Plan, there will be a shortage of 22.7 million housing units by the year 2007. The changing lifestyles of Indians and better incomes have led to the development of retail and hyper malls. This, in turn, has led to the demand for space from the retail sector. Real estate has proved to be a real engine of growth - The real estate sector

in India is emerging as the next engine of economic growth going by the fact that it is the second largest employer next only to agriculture. It has significant linkages with several other sectors and over 250 associated industries. According to estimates, every rupee invested in this sector results in 78 paisa being added to the GDP. Accordingly, a unit increase in expenditure has a multiplier effect and the capacity to generate income is as high as five times. For instance, if the economy grows at the rate of 10%, the sector has the capacity to grow at 14% and generate 3.2 million new jobs over a decsde. The sector size is close to $12 bn and grows at 30% per annum. Presently, it is contributing 5% of the country's GDP and is expected to rise up to 6% within three to four years. Along with the residential property, the sector has also witnessed a spurt in demand in commercial property mainly driven by fastgrowing IT and ITES services along with BPO boom. According to estimates, 42 million sq. ft. of space will be required every year till 2010 only in these services in cities like Delhi, Bangalore. Chennai. Hyderabad and Pune. As the cost of land in leading metros is skyrocketing, developers are getting interested in developing townships in Tier II cities and industrial towns where the growth of real estate is relatively slow. It is expected that is the very near future, even these cities will witness abnormal prices.

THE KEY DRIVERS IDENTIFIED BEHIND THIS GROWTH ARE-IN CASE OF RESIDENTIAL PROPERTY: Higher affordability (higher salaries, easy credit); tax benefits to borrowers; existing shortages: social structural changes in urbanized areas (splitting of joint families). In case of Commercial: IT/1TES sector expansion, the local consumption story leading to higher growth in corporate earnings; order books full; corporates expanding, multinationals entering India to service huge "middle class". In Retail sector: Getting organized (3% of retail is organized as against 17% in China); foreign brands and local brands seeking visibility, new formats being developed; disposable incomes rising; younger population earning and spending well. In terms of infrastructure Indian real estate sector is relatively poor to global standards: If we compare Indian real estate sector with the global real estate industry, we fare very poorly in terms of our infrastructure. While in the US. no matter where you go, you have access to high quality infrastructure (drinking water, well-planned roads, greenery, power, communications, healthcare, education, etc.). here in India, even our signature cities are crumbling. We have not been able to create alternate cities in the manner that is required so as to release the pressure on the few that we have. Until new towns/cities come up. the few existing ones will continue to provide substandard quality of living and at very high prices. Another sharp contrast is in the sphere of public housing. While more than 50% of Mumbai lives in slums, most of Singapore lives in (subsidized) mass housing provided by the government. Whether this boom will sustain or not, the answer could be both a yes and a no. Yes. because of the above mentioned positive drivers. No ? because a lot of factors/events can spoil the party; such as, an increase in interest rates globally and locally, a political directive (overseas) to reduce outsourcing to India, the

emergence of China as an alternate outsourcing hub, a major terrorist attack, the policies of the government with respect to land and real estate supply, property prices becoming unaffordable, etc. Already in some locations it appears that the cost of land is way too high iu comparison to the finished product, and there is a price limit beyond which resistance can set in. Therefore, there is a risk of having unsold inventory at a high cost. In some sectors, there is a re-emergence of the ""investor" in large proportions. Hence, when the stock comes in the market tor absorption in large volumes, will there be actual users to absorb it? That is still to be seen. On the retail front as a whole, though we (as a country) have barely scratched the surface of organized retail, I feel that in some locations there is an excess supply of mall space coming up. With terribly poor efficiencies and very high running costs, not to mention a complete lack of differentiation, it's a matter of time before these malls will come back in the market to be repositioned. Today, there is a feeling of success seeing "footfalls'" by the thousands, which reminds me of the internet days "eyeballs"plenty of visitors, poor conversion into shoppers. BUYERS PERSPECTIVE: 1. Quality of Construction - Obviously when one buys a property he makes sure that the quality of construction is good. Everyone while buying a new product wants to buy quality stuff. Same applies to the property. Every buyer wants to buy a well built house. 2. Pollution Free Environment The immediate surroundings of the property is always evaluated by the buyer. These days developers give due importance in making the surroundings beautiful with innovative and creative landscaping. They involve landscape architects from different corners of the world to give their customers the best. The NCR is becoming more and more popular among home buyers because of its greenery and pollution-free environment. 3. Water Availability - Water Availability, power backup and safety and

security are some very important factors which people do consider while purchasing the property. All these factors are hugely responsible for the transition of people from Delhi to housing complexes in NCR as many colonies of Delhi faces problem of shortage of water and pewer failure while availability of these essential facilities are ensured in housing complexes by die respective developers. 4. Occupancy - Due to increasing crime this factor is becoming more and more important for die buyers. They don't want to settle down in such a place where hardly anyone else lives. People prefer to stay in a reasonably well-occupied housing complex. But its also true that people don't prefer to stay in highly populated areas as it was observed in the case of Shipra Sun City, Ghaziabad where 5000 families living in one single housing complex fight for space and car parking place. 5. Suitability of Home Type - Nowadays due to the wide range of options available people can afford to be choosy. Now they don't need to compromise on anything. They don't buy a property till the time all of the essential things match their requirements. Developers do pay attention to the different requirements of different customers. Some want a flat on the second floor while some want a flat with two bedrooms. All these requirements are tried to be met by the developers. 6. Sport Complex / Recreational Facilities - "All work and no play makes Jack a dull boy". People have started believing in this concept. Now each parent wants that within the complex his/her kids get all kind of sports to play. Even adults want different recreational facilities to be available in the housing complex, which may help them in eliminating work stress. DEVELOPERS PERSPECTIVE: 1. The major external factors which people consider while purchasing the property are Price, Availability of loan and Proximity to workplace. 2. The major In-Locality factors which people consider while purchasing

the property are Quality of construction, Availability of water and Pollution-free environment

GLOBAL SCENARIO fN REAL ESTATE INDUSTRY Real estate industry in developed countries has been mature while it has been a growing market with huge potential in developing countries like India. Anuj Puri , Managing Director of Trammell Crow Meghraj Private Limited opines: "Globally, these funds are very popular, especially in developed economies such as the US. Australia, and Japan. They have given excellent risk-adjusted returns. As per NAREIT, the five-year compounded annual growth rate (CAGR) on such funds is 12.1%. In Japan, this is 15.5%. This compares well with equity mutual funds. For real estate, the risk is lower than equity." Real Estate Investments Trusts (REITs) in the US are the trusts established by wealthy promoters who usually invest in shopping malls, office spaces, commercial complexes, hotels, and warehouses. The origin of REITs dates back to 1960 and has gained popularity over a period of time. These trusts make profits either by rental income or by capital gains resulting from sale of property. To be qualified as an REIT, the company is liable to distribute 90% of its income to the shareholders. This will in turn help the company to get exemption from taxation. Based on the source of income, REITs are categorized as equity REITS. which earn by owning and renting the properties; Mortgage REITS, which earn by way of loans; and Hybrid REITS, which earn by both the means. REITs offer ample Liquidity to the investors as REITs shares are usually listed on the major stock exchanges. REAL ESTATE FINANCE: Property prices in India are rising fast, and not just in the biggest cities. As the tech boom spreads across the country, as more Indians buy homes, and as the economy grows at faster than 8% a year, real estate is attracting more investors, many of them from abroad. "India is one of the last few countries where there is primary demand for real estate rather than individuals trading up," says Rajiv Sahney. who runs the India operations of New Vernon Advisory, a S1.4 billion New Jersey hedge

fund. Merrill Lynch forecasts that the Indian realty sector will grow from $12 billion hi 2005 to $90 billion by 2015. "India is the most exciting real estate market in Asia," says Michael Smith, head of Asian real estate investment banking at Goldman Sachs. "It's one of die last major countries in Asia with an improving market." That improvement worries some. Concerns about an asset-price bubble have led the Reserve Bank of India to raise the risk weightage on real estate loans extended by banks, and mortgage rates have gone from 7.5% to about 9.5% as a result. That's still well below the 15% rates that most Indians were used to, but it's enough to raise questions about whether the speculation of the past year and a half, which has driven land prices up by 30% to 100% and real estate stocks up as much as 2,000%, may be corning to an end. The run-up in prices ha1? attracted the likes of Morgan Stanley, which has invested $68 million in ManLri Developers, a midsized construction firm in Bangalore, and Merrill Lynch, which invested $50 million In Pandisheel Developers, a regional builder. Foreign companies have also poured money into funds that invest in Indian developers. GE Commercial Finance Real Estate, for example, has invested $63 million in an S800 million fund that is building IT parks, and Calpers and the Oregon Public Retirement Fund have invested $100 million each in the IL&FS India Realty fund. Real estate funds set up to invest only in India have already raised more than $2.7 billion. And new funds worth as much as S4 billion are being planned by J.P. Morgan, Britain's Knight Frank, and other foreign investors. Warburg Pincus, the largest private-equity investor in India, says it is spending nearly a third of its time studying opportunities in this area. And Deutsche Asset Management recently hired someone to head its real estate activities in India. "As the largest active managers of real estate funds in the world," says Edouard Peter, head of Deutsche Asset Management Asia Pacific and Middle East, "we

expect to be actively raising and investing funds in real estate in India." It isn't going to be a cakewalk. "It's not easy to do business in India." says Seek Ngee Huat, president of GIC Real Estate, an arm of the Singapore government that is planning to invest several hundred million dollars in Indian real estate over the next two years. "It's difficult finding suitable partners who have the same long-term objectives, as most firms are small and family run." Already margins have shrunk. "The vast majority of the planned real estate funds are targeting annual rates of return of between 25% and 30%, but I'm skeptical that the vast majority will cross 20%," says Mumbai real estate advisor Rajiv Bhatia, To achieve the target returns, several funds are focusing on second-tier towns and second-tier developers. "Many investors are going to lose their shirt here, as it's an opaque market, and a wrong partner can easily do you in," says S. Sriniwasan, executive director at Kotak Mahindra Realty fund in Murnbat. There's also bureaucracy and corruption to deal with. Says Ashwin Ramesh, who runs a boutique fund called Primary Real Estate Advisors: "There are a couple of hundred malls currently being developed across India, and predictions are that only 10% will be successful. Yet every developer feels his mall will be among the survivors,"

REAL ESTATE INVESTMENT A refill report by the Chamber of Indian Industries pointed out that globally real estate is and should always be considered as an income-generating asset. Indeed, real estate is an attractive investment option, as it gives regular returns and also provides capita! appreciation. This scenario is presently unfolding in India. Before the start of the 1990s, real estate was always looked upon as a place to invest money, since prices were always escalating because of limited supply and heavy demand. Developers were building residential and commercial projects, which were sold nut even before the construction began. Besides, during the course of construction, the property changed hands several times before the completion of the project, with further price increases. But, those days are gone with the crash of the housing market in the mid 1990s. The higher the rise in real estate prices, the steeper the fall. This was true, especially, in the metres, e.g. Mumbai and New Delhi. The supply increased enormously and the demand remained steady, as prices had gone beyond the realistic levels. This decline in prices stabilised towards the end of the decade as rates became more reasonable and affordable. In the meantime, the housing finance industry started to expand rapidly, making home loans easily available to everyone. Besides the housing loans boosting the market demand, the tax benefits provided by the last four consecutive budgets have also encouraged the end-users and investors alike. Growing incomes of urban buyers coupled with fiscal incentives and falling interest rates, has seen disbursements by Housing Finance Companies grow at over 35% per annum in the past few years, as shown in Figure 1.

Figure - I

To evaluate real estate as an investment option, use the following guidelines. => Check out the various loan options to raise the finances. Ensure that there is scope for infrastructure development around the property under consideration. Another factor is the location and the proximity to schools, hospitals, markets. public transportation, etc. Check out the rental returns and capital appreciation potential in the area where the property is located. Actual property taxes to be paid. Finally, ensure that you are able to maximize the tax benefits to the limit.

The rental rates in India are among the highest in the world as returns on investment on the capital value of the property. Figure II compares the rental returns for various cities all over the world with the Indian cities. Investment in commercial property, where the returns are 10 to 15 per cent, is a proven option, while residential property is always in demand for leasing.

Figure - II

Since the 9/11 attack in the US. investments in Indian markets have gathered pace. India has encouraged Non Resident Indians {NRIs) with tax incentives and relaxation of foreign direct investments (FDI) rules. The sudden change in sentiments is clearly visible in India's bulging foreign exchange reserves, which are at a record high of over 60 billion US dollars. And the RBI has relaxed the rules further for NRIs with respect to repatriation of foreign exchange on real estate investments. Besides being a safe destination, India offers 10 to 12 per cent returns, perhaps the highest in the world. 30 per cent of ail high major real estate transactions in Mumbai are accounted by NRIs. Moreover, with increasing volatility in stock markets and falling interest rates, many investors have started considering investment in commercial and residential properties. The bottom-line is that this is the time to go shopping for property; as the market has started firming up already. As the organised market develops, real estate as an investment is one of the better options available today. As Naresh Malkani. CEO of Indiaproperties, says, "Considering the current property rates and housing loan interest rates, it is worth investing in real estate in India."

ESCROW ACCOUNT MECHANISM During the boom period between 1991 and 1995 developers had invested heavily in land by diverting funds from other project and taking on huge liabilities from banks and financial institutions. With the crash in the markets the value of these investments were eroded. Most banks and financial institutions today have frozen all their lending to the developers community. The main reasons for this being the inability of the developers to repay their debts. To instill confidence in the lenders the developer community would need to organise themselves and bring about greater transparency in their operations. In this respect developers must explore the 'Escrow' mechanism to tap funds from Banks and Financial Institutions . Under the Escrow mechanism the loan amount is decided after doing a thorough due diligence of the accounts of the developer. All transaction (inflow and outflow) are routed through a designated Escrow Account, the control in which remains entirely with the lender. The progress of construction is monitored by the appointed auditors who submit periodic progress reports. Disbursements are made strictly on the basis of the progress reports. This system will not be successful without the co-operation, commitment and support of the developer community. Position on project / Venture Capitals - The financiers takes a position like private placement of area to be constructed at discounted rates and funds the project. On completion of the project or during the construction, the developer sells on behalf of the institution and gets their investment back with return. All loans originating from these sales should go to the institution which funded the project. This the financiers can do after due diligence as listed below: RISK EVALUATION AND MITIGATION Essential to establish counter - party risks and mitigate them before offering construction finance to borrowers. Finance available to builders with established track record. => Minimum Net worth Criteria Track record of successful completion of projects => Established source of cash flow and revenues

Loans are usually project specific. In addition to builder risk, saleability of project depends on Location Demand & Supply of flats Pricing Opinions from consultants are sought to mitigate these risks.

Due diligence of all transaction documents including => => => => Title documents MOU for land Power of Attorney Municipal clearance

Line of Credit - Like working capital advanced by banks, in this case, builders with track record are able to work out their financial requirement and line of credit is approved by Housing Finance Institution. This is for a minimum period of 4 -5 years renewable on a year on year basis. This covers all the projects of the developers. This can be availed after the institution is satisfied about the following itemsCRITICAL LENDER REQUIREMENTS project. Property should have clean title Property should be easily marketable Builder to obtain statutory approvals prior to loan disbursal Loan to be secured by mortgage of the property of the proposed

STRATEGIC FACTOR ANALYSIS Both serious academic research and informed business activity will be enhanced by reliable collection of data relating to housing and commercial real estate. Housing data, including prices, volumes of existing and new housing transacted, housing starts, vacancy rates and household formation rates, as well

as other demographic data, segmented by metros, states and at die national level need to be collected frequently and in a reliable manner by local and central authorities and disseminated widely. Real estate commercial data would be more or less the exclusive domain of the private sector. USE OF IT IS VITAL Here India has an opportunity of leapfrogging ahead of a number of other countries by harnessing its comparative advantage in information technology. In some of the more developed countries online databases of different kinds of real estate (office, retail and industrial/warehouse) with data on city-wise vacancy rates, capitalization rates, the local economic situation, job and household creation help firms, investors and businessmen make informed choices. THE DISCIPLINE Links with urban planning and regional economics, on the one hand, and finance and macroeconomics on the other would go a long way in a better understanding of the economy, its monitoring, regulation, management and forecasting. It will also promote appraisal and valuation techniques. In India, provision of housing credit may be a supply side issue since banks cannot properly evaluate lending risks in the absence of development of credit and risk assessment systems, and databases on credit benchmarks and credit scoring. It is vital to develop these risk management systems on the basis of sound data and proper, widely available techniques. All these steps will promote analyses and research that could inform domestic or foreign investors to evaluate markets and carry out risk assessment for purposes of property development and investment. The establishment of the discipline of real estate economics would help in the dissemination of a common language of discourse and promote standardised procedures, both necessary for national market development

REAL ESTATE -DELHI AS THE TARGET MARKET Delhi is now more or less saturated and the high demand for residential properties has increased rates beyond the reach of middle class. As a result, the suburban towns within the NCR; Gurgaon. Noida, Faridabad and Ghaziabad have become destinations for new residential projects that offer affordable quality housing to the middle class as well as luxury housing for high end users. As these suburbs are now increasingly generating employment, they will decide the future growth pattern of the NCR. The business and trader class still largely dominate old residential areas in west and northwest Delhi. Similarly the large multi-storey societies in East Delhi in mayur vihar and Patparganj - have found preference with the service class. Hie blue-collar segment remains limited to apartments and society developments while big and small traders occupy the whole of west Delhi, including Rohini. The elite class, in terms of social status, i.e. politicians, bureaucrats and celebrities, restrict themselves to central and south Delhi. Suburban areas like Noida and Gurgaon have developed as alternative housing solutions and are inhabited mostly by professional and service class people, as well as an increasing upper middle class segment. Gurgaon offers a good quality of living with many high-end residential projects by private developers. These new developments offer uninterrupted power supply, community and health care centers along with facilities like a swimming pool clubhouse and other services. As per industry estimates, projects with approximately 5000 dwelling units have been announced in Gurgaon. Since it will be maturing as an independent city, occupancies will improve but in the present context, it is an oversupply situation. Noida has experienced rising prices in its existing commercial, retail and residential real estate. The new developing residential sectors are along the Greater Noida expressway. Occupancies in Noida are good and prices are looking northward. It is a good destination for the middle class, as far as

accessibility, social and physical infrastructure and growth perspective ate concerned

DISCUSSIONS
REAL ESTATE MARKET Construction sector has been the focus sector for some time as its impact on the economy is big by virtue of its being a huge employment generator. The real estate market is booming. Its growing at around 12% per annum. Today its boom time in the real estate market and homebuyers couldn't have asked for a better opportunity to buy a home. Indian developers are now not talking of anything less than world class. Infrastructure and economic development of some cities as well as the housing shortages are driving the boom. There is a fundamental change in the approach of the buyer, developer and the government. They all are seeking quality development. The middle class demands the best that money can buy. With the competition in the market, developers have to deliver the best within specified time frames and the government, discharged from the duty of construction has to keep everyone's interest at heart. The Major reasons for boom in the real estate market are: EASY AVAILABILITY OF LOAN AND LOWER INTEREST RATE There is easy access to loans. The housing finance has posted a growth of 29 percent in the last fiscal, touching 53.685 crores. Further, interest rates on housing loans have come down and are much lower, between seven to eight percent as compared to 13-14 percent five years ago. AFFORDABILITY Another major reason for boom is that housing in India has become more affordable in recent times. A decade ago, a house cost nearly 15-20 times an individual's annual salary. Today the cost of a house has come down to just about three to four times an individual's annual pay package.

INCREASE IN NUMBER OF NUCLEAR FAMILIES In the past, owing a home was a dream realized only after retirement Largely because people looked at it as a means of providing for their children, having themselves lived in a joint family setup. Joint families are progressively getting included in the pages of history book even in a country like ours. Not surprisingly the rise in the number of nuclear families is pushing demand for housing further to cater to a generation that is not averse to taking risks. Nor are they hesitant when h comes to paying a price to realize their dreams. INVESTMENT OPTION Competitive offers by home loan companies combined with good quality projects developed by reputed builders having a number of amenities have made investing in properties very attractive Wherever there is growth and opportunity, investors are bound to be around and traditionally real estate has been a safe investment option. Property is looked upon by many as an investment option that appreciates substantially when compared to other traditional tools of investment. MIGRATION OF INDUSTRIES Another major reason for boom in the real market is the migration of industries to smaller towns leading to rural progress. With villages turning into towns and towns becoming metros, the property market is growing steadily. This revolution has directly resulted in greater demand for not just housing but also for the overall real estate market with heightened demand for better infrastructure, transportation facilities, entertainment zones, shopping malls, multiplexes and more.

Three tables and charts have been prepared for each of the three cities namely Gurgaon, Noida and Ghaziabad to analyze what respondents from each of these cities think about five cities included in NCR namely Gurgaon. Noida, Greater Noida, Faridabad and Ghaziahad on the basis of five parameters namely Location, Business Opportunity. Law and Order, Style of Living and Infrastruetural Development and also to know the reasons for which they bought the property. GURGAON PERCEPTION OF PEOPLE ABOUT THE CITIES OF NCR Location Gurgaon Noida Greater Noida Faridabad Ghaziabad 202 34 1 2 1 Business Opportunity 180 36 12 10 2 Quality of living 210 19 8 1 1 Law and Order 184 25 17 1 4 Infrastructural Development 106 63 65 2 5

FINDINGS: 1. 2. Gurgaon buildings stand tall in each and every parameter. Gurgaon tops in all the parameters among Gurgaon respondents, Though in case of Infrastructural Development Greater Noida and Noida are also ranked well by the Gurgaon residents. Probably the credit goes to DND flyover, 3. Location wise, people of Gurgaon feel only Gurgaon and Noida are good in the entire NCR as Greater Noida. Faridabad and Ghaziabad could fetch only 1, 2 and 1 favourable response out of total 240 responses. FIRST PULL TO CHOOSE THE HOUSING COMPLEX Brand name 14 Advertisements 11
Most Important Factor

Location 85

Affordability 92

14 11

Brand Name

92

Advertisements

Location Affordability

85

FINDINGS: 1. The basic reason for people buying property in Gurgaon in mass scale is its locational advantage. It shares border with the Capital of India. Moreover huge employment generating BPO companies are located in Gurgaon. Many Reputed schools and colleges have also come up in Gurgaon. Some of India's biggest shopping malls having shops of international brands as well as famous national brands are also situated here. 2. Second major factor which attracted people to buy property hi Gurgaon was affordabiHty. Developers realizing that most of the people shifting to Gurgaon will be from middle class society they constructed big towers with numerous reasonable flats. Since the price of the property kept by the developers suited the pockets of buyers they were able to huy it without any financial problem. 3. Third major factor was brand name. According to 17 % of the total respondents brand name was the prime reason for which they bought the property. In Gurgaon Housing Complexes have been constructed by popular and leading property developers of India like Unitech, DLF, Ansals, Omaxe, Etc. 4. Only 4 % of the total respondents feel that it was advertisements which made them buy the property. Advertisements can actually put the name of the property in the mind of the buyer but no one actually buys the property only on the basis of advertisements. Thus it will be wrong to say that advertisements are useless since they do help in selling though not directly.

MAJOR REASONS FOR SHIFTING

Reasons No. Of people

More space 46

Better Location 84

Better Healthy Increase in Quality of Facilities environment living status construction 54 43 Own house 38 Investment 11 Others

Reasons Lack of Proximity Job facilities to transfer Workplace No. Of people 18 58 10

42

11

26

Major Reasons for Shifting

FINDINGS: 1. Among various reasons better location is the most important reason for the people to shift to Gurgaon Housing and Society Complexes. Why location is most important has become apparent till now. 2. Proximity to Workplace and Better Facilities are close second and third most important reasons. Proximity to Workplace may become the most important reason in few years time as industry migration to Gurgaon is happening quickly. All the international brands are preferring Gurgaon over Delhi for their regional office. Moreover people in need of better facilities like water availability. Power Backup, Safety and security, etc also prefer to shift to Gurgaon as Housing complexes of Gurgaon provide all these facilities. 3. Need for more space, Need for Healthy Env iron men t. Need for Own House and Increase in Living Status can be considered as other major factors for people shirting to Gurgaon Housing Complexes. 4. People also purchased property in Gurgaon for investment purpose. This

reason may not be seen in such a large number in any other city of NCR. Its so because people consider investment in property in Gurgaon as a very safe bet and expect high return on Investment.

NOIDA PERCEPTION OF PEOPLE ABOLTTHE CITIES Location Gurgaon Noida Greater Noida Faridabad Ghaziabad 2 54 0 0 0 Business Opportunity .13 32 2 9 0 Quality of living 22 32 2 0 0 Law and Order 22 27 7 0 0 Infrastuetural Development 6 9 41 0 0

FINDINGS; 1, In Location, Noida is a clear winner with 54 out of 56 respondents choosing it as the best location in the entire NCR. That is a huge percentage around 96%. This shows that Noida people are happy with its Location. Noida is located close to the Capital of India and is also very closely located to Indirapuram, another upcoming city. 2. In all parameters other than location. Gurgaou has also been ranked as no. 1 by many people.

3.

One significant thing in this chart is that Faridabad was selected by many Noida respondents as no.l in case of business opportunities available.

4.

The most significant thing indicated by the chart is that people of Noida have chosen Development.41 Greater Noida as no.l in Inthistnicrural out of 56 respondents have favourably marked for

greater Noida while only 9 have marked for Noida. FIRST PULL TO CHOOSE THE HOUSfNG COMPLEX Brand name 1 Advertisements 0 Location 40 Affbrdability 31

FINDINGS: 1. In Noida just like in Gurgaon, location is the most important factor that pulls the people to buy a new home. 2. Advertisements have no role in the sale of homes but as said before in the report advertisements do add the advertised property as an option in the mind of the prospective buyer. 3. According to respondents from Noida Brand name of the developer didn't play a big role in making them buy the property. Its probably because Noida doesn't have highly popular brands like Ansals, Unitech. Eros. DLF. etc. 4. Afford ability is another major reason for the buying the property in Noida. As there is hardly any popular developer in Noida and the homes provided in Noida are not as luxurious as that in Gurgaon, the prices are very low as compared to the prices prevailing in Gurgaon. In Gurgaon Higher class and Upper middle class people also buy homes in large numbers whereas in Noida the number of high class and upper middle class people looking for new home is very less. MAJOR REASONS FOR SHIFTING Reasons More Space 31 Lack of facilities 5 Better Location 28 Proximity to workplace 2 Better Healthy Increase hi Quality facilities environment living constructio status n 35 11 13 9 Others 3

No. Of people Reasons No. Of people

Job Own house Investment transfer 0 31 1

Main Reasons for Shifting FINDINGS: 1. One of the most important thing found out in the survey was that the one of the major reasons to buy the house was the desire of people to have their own house. This reason was not at all important in case of Gurgaon. Tins goes on to show that houses in Noida are very reasonable. Mostly people earlier living in rent have bought properties in Noida either to avoid high rents prevailing in Delhi or due to the desire of having an own asset. 2. Need for better facilities was tick marked by maximum number of people as a reason for buying the property. This again proves the fact that people buying property in Noida arc generally from middle class who earlier used to live in less popular colonies of Delhi which are deprived of essential facilities like water, power and safety. 3. Another major reason for buying the property in Noida is Need for more space. Generally people earlier living in joint families or newly married couples prefer buying property in Noida as they are affordable. 4. Only 1 out of 56 respondents have said that investment was the main reason to buy the property, which is around 2 % of the total respondents. This goes on to show that people don't generally buy property in Noida for investment purpose. 5. Another important point to notice is that in Noida proximity to workplace reason is insignificant. Its probably because virtually non-existence of BPO companies in Noida.

GHAZIABAD PERCEPTION OF PEOPLE ABOUT THE CITIES OF NCR Location Gurgaon Noida Greater Noida Faridabad Ghaziabad 20 93 2 1 34 Business Opportunity 28 75 6 17 24 Quality of Living 59 74 9 2 6 Law& order 60 64 12 5 9 Infrastructure 40 49 48 0 13

Perception of People About the Cities of NCR


250

200

Gurgaon
150

Noida Greater Noida

No. of People
100

Faridabad Ghaziabad

50

Location

Business Opportunity

Quality of living Law and Order

Infrastructural Development

FINDINGS: 1. 1 .Respondents from Ghaziabad have chosen Noida as the best location in the entire NCR. As many as 93 out of 150 respondents have marked favourably for Naida which is around 60 % Of the total respondents. This clearly goes to show that Ghaziabad respondents have good image of Noida as far as location is concerned. 2. In all other parameters there is a clash between Noida and Gurgaon but Noida seems to lead in every parameter. 3. In business opportunity Noida have again been favoured while rest four have almost same image in the mind of Ghaziabad respondents. 4. In case of quality of living both Noida and Gurgaon have been marked by many as number I. Style of living in other three places do not have enjoy good reputation in the mind of the Ghaziabad respondents. 5. In case of law and order Ghaziabad and Faridabad are clear losers, This fact has been observed in all the three cities, 6. In Infrastructure Greater Noida enjoys good reputation.

FIRST PULL TO CHOOSE THE HOUSING COMPLEX

Brand Name 14

Advertisements 11

Location 85

Affordability 92

FINDINGS: 1. In Ghaziabad affordability is the main reason for the people buying property out there. The occupied Housing complexes of Ghaziabad are pretty old and very reasonable. Developments in Ghaziabad started much before it started in Gurgaon and Noida. So at that time prices were low. Now with the massive development of Noida. Gurgaon as well as of fndirapuram price of property have increased like anything. 2. Location is the second most important factor which makes people buy property in Ghaziabad. Ghaziabad is located close to Noida as well as Delhi. Moreover Indirapuram, the real upcoming area is its neighbour. Moreover Ghaziabad's development took place years ago so it already has lots of facilities available. 3. Advertisements and brand name did compel few to buy the property in

Ghaziabad but still they were not so important factors. MAJOR REASONS FOR SHIFTING Reasons More Space Better Location Better facilities Healthy Increase in Quality environment living construction status

No. of People

49

73

37

11

Reasons

Lack of Proximity facilities to workplace 9 12

Job trans fer 5

Own house Investment

Others

No. of People

54

20

Major Reasons for Shitting

FINDINGS: 1. Though Ghaziabad respondents have rated Affordability a5 the major reason for buying the property in Ghaziabad but if we exclude affordability as a factor we find that location too was a very important factor as we can see in this chart. 71 out of 150 Respondent have marked location as a reason for buying the property i.e. around 50 % of the total respondents. 2. Jest like in Noida, the desire to have an own house is a major reason to buy a property, in Ghaziabad too. This proves the reliability of the previous chart which shows that ihe major reason to buy a property in

Ghaziabad is aftbrdability. 3. Tliird most important reason for buying property in Gliaziabad is requirement of more space. 4. Same as Noida reasons like proximity to workplace and investment arc almost insignificant.

OTHER BUILDINGS SURVEYED Unitech Nirvana Country (Gurgaon) Unitecli The Close (Gurgaon) Omaxc Nile (Gurgaoti) Omaxe NRI City (Greater Noida) Omtixe Forest (Noida) Omaxe Royal Residency (Noida) Jaipuria Sunrise (Iiidirapuram) Ashiariii Greens (Indirapurym) Ashiana Orchids (Greater Noida) Supertech Estate (Indirapuram) Supertech Avant Grade (Indirapuram) Eldeco Golf View Apartments (Greater Noida) ATS Green Village (Noida) Assotech Windsor Greens (Noida) Assotech Windsor Park (Noida) Vatika City(Gurgaon)

ANALYSIS OF DATA COLLECTED FROM DEVELOPERS Sales managers were asked to rank the above mentioned factors on the scale of 1-10 (where 1 stands for the most important factor and 10 stands for the least important factor). After collecting the data, it was put in the excel sheet and then average for each of the factors was calculated. In the above Bar chart averages have been shown. Factor with the least average is the most important factor according to the developers, that people consider while purchasing the property. FINDINGS: 1. It is clear from the above bar chart that Location is the most important factor which people consider while purchasing die property. 2. After location, quality of construction and safety are second and third most important factors respectively, 3. Healthy environment, Water availability. Maintenance, Power Backup and club membership fall in (he middle category with average ranking ranging between 3.5-7. 4. Car Parking and Sports complex are least important factors and according to developers, people dont consider them much while choosing a property. CONCLUSION The major external factors which people consider while purchasing the property are Price, Availability of loan and Proximity to workplace. 1. The major In-Locality factors which people consider while

purchasing the property are Quality of construction. Availability of water and Pollution-free environment 2. Perception of people about different cities of NCR Location wise Gurgaon and Noida are adjudged the best by the

respondents Business opportunity wise Gurgaon due to the mass presence of BPO company and offices of MNC's and Noida due to its proximity to Delhi are consider good by the majority of respondents. In Quality of living again Gurgaon and Noida leads the pack but out of the two Gurgaon is better due to the existence of Higher and uppermiddle class people in large number. In Law and Order all the places are bad as per the respondents but out of the five Gurgaon is the best. As far as infrastructural development is concerned Greater Noida enjoys good reputation among the respondents of all the three cities. 3. In totality, both Location as well as Affordability together account for more than 95 % of the total responses. 4. In Gurgaon major reasons other than affordability and location, to purchase the property were proximity to workplace and healthy environment. 5. In Noida and Ghaziabad ether major reasons were almost the same -desire to own an own house as well as need for better facilities.

RECOMMENDATIONS As Uniteeh enjoys good brand name and have a battalion of" brand loyal customers it shall make sure that the maintenance of its occupied housing complexes is taking place in the best possible manner. Due to stiff competition in the market Unitech shall focus on the Quality of homes provided and shall also try its best to meet different kind of requirement of different buyers. Due to the current oversupply situation in the market Unitech shall resist from increasing price of its property. Unitech shall help and lure the prospective buyers by helping them in getting housing loans. It shall collaborate with some popular banks for this purpose. These days even banks are more than willing to provide home loans. Unitech shall provide the right amount of greenery in its housing complexes, as pollution free environment is a very important factor that people consider while purchasing the property. Gurgaon, Noida and Greater Noida are the places where Unitech shall come up with new projects as they have been marked favourably by the al! respondents. Respondents do not have good image of Faridabad and Ghaziabad while Indirapuram is yet to prove its worth. Advertisement for selling property in Gurgaon can be "Why drive for 45 minutes to your workplace everyday, take a flat in Gurgaon today." As proximity to workplace is the major reason for people buying flats in Gurgaon. Whereas for Noida and Greater Noida advertisement can be like 'Ted up of paying rent. Now realize your dream of having a house of your own-COME TO NOIDA" as desire of having an own house is the most important reason for the people buying property in Noida.

BIBLIOGRAPHY BOOKS & JOURNALS Real Estate in India , JM PUJARI, Manav Publication, 2006 INTERNET LINKS www.unitechgroup.com www. dif-group, com www.ansaliipropcrtiesltd.com www.cros-gronp.com www.eldecogroup.com www.omaxe.com www.pursvnath.com www,ashianahousing.com www. gurgaonpropetties.net www.realestatencr.com www.toirgaonrealestate.com www.estatcdevelorjer.com