Hit by the sub prime crisis in the west, property developers from the US and UK are eying emerging economies like India for selling their projects, albeit at a discounted rate.
In its worst housing slump since the 1930s, property prices in major cities in the US have declined roughly over 20 per cent in several cities in the last one year.
According to the latest data released by Standard and Poor's for its S&P/Case-Shiller Home prices Indices, home prices in the US continued to show double digit decline in prices.
According to the report , the annual returns of the ten-city composite and the twenty-city composite home price indices, reached new record annual declines of 17.5 per cent and 16.3 per cent, respectively.
Developers who launched projects in the western markets in the last one or two years were now finding it difficult to sell their projects.
They were now selling their projects in countries like India as an investment opportunity.
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According to Joshua Kumar, chief executive officers and director for regional investments for HomePlace International, a Singapore-based property consultant, "Indian Investors are always in the radar of any international developers. In November, HomePlace will launch USA, UK & Hungary projects being developed by Castlewood Investment Properties Pte. Ltd., Singapore."
About 300 houses in South Carolina, USA, will be up for sale in the fair. Singapore-based Land Solutions India (LSI) were also selling properties in Singapore and Hungary in the Kolkata market. “the demand is far beyond expectations- around 75 units in Singapore alone in a year”, said LSI CEO Akshay Jain.
As for sops for buying the properties, marketing agents said they also arranged for leasing out the properties.
"Due to the acute sub prime crisis, acute financial crisis the local citizens are not investing in real estate," said Kumar.
"There is where we recommend our investors to step in as the prices are rock bottom. Hence when the market stabilizes, the investor can make a decent profit and exit," he added.
In UK, property price starts from UK Pounds 67,000 onwards.
The cheapest would get an investor a two bedroom independent unit, with rental income schemes. In USA the price starts from as low as $350,000 onwards.
However, with real estate in India also headed for a slump, overseas developers may find selling their projects in India difficult, as according to some analysts there is about 30-40 per cent fall in property purchases in India over the last few months.
According to Avneet Singh, vice president-sales and marketing, Winmark Services, engaged in organising several industrial shows in India and abroad, in several tier I cities developers have resorted to distress sale, at about 20 per cent discount.
Also, local property developers were eying NRI investors, and shifting their focus to SEZ projects to beat the slump, Singh said.