What is happening in the current Real Estate Sector? October 2017 Update

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November 7, 2017 Real Estate Industry

Get the latest news from various dailies and stay up to date with the real estate sector of Bangladesh and its neighboring countries.

“Government takes multiple initiatives to tackle housing problem”

Date: 1 October 2017

Source: Kaler Kontho

The article features World Habitat Day and Government efforts to tackle housing problem in Bangladesh.  The theme of this year’s World Habitat Day was “Housing Policy: Affordable Homes”. To make housing available for all segments of people in Bangladesh, Government has taken multiple initiatives to build homes not only in the cities but also in rural areas.

The article states after the approval of Housing Policy 2016, the policy has been reformed to include facilities for private real estate developer companies in Bangladesh too. It further mentions shortage of housing growing over the years owing to the exponential population growth in the city compared to the rural areas. In 1993, there was a shortage of 31 lac units in the real estate sector of Bangladesh, in 2000 it was 50 lac units which further increased to 1.13m in 2001 and 4.6m units in 2010. Projection by real estate experts suggests that the shortage would increase to 8.5 m units in 2021. To bridge the gap, “Housing Policy 2016” was approved which includes various policies such as land price, construction cost etc. Ministry of Public Works and Housing Secretary Shahid Ullah Khandaker stated the focus would primarily be given on housing of low income people and later would incorporate other segments. Meanwhile all concerned bodies including development authorities of the capital city, Chittagong, Khulna, Cox’s Bazar, Khulna and Rajshahi are working collectively to meet the housing demand of the whole country.

 “80,000 Flats to be built in Purbachal”

Date: 2 October 2017

Source: businessnews24bd

The article features a talk by Housing and Public Works Minister Khandaker Mosharraf Hossain where he talked about the upcoming project of 80,000 flats to be built in Purbachal in the capital city of Dhaka for low-income people. The speech was delivered by him in Osmani Memorial Auditorium on a discussion marking the World Habitat Day. He stated that the process to start the construction of flats in Dhaka in Purbachal area is already under way. Apart from these, the government has started allocation of ready flats in Uttara and has further plans to build around 1 lakh flats in Uttara, Purbachal and Jhilmil areas.

Secretary of Ministry of Housing and Public Works Md. Shahid Ullah Khandaker presided over the discussion. Others present in the discussion were UNDP Country Director Sudipto Mukerjee, RAJUK Chairman Abdur Rahman, Chief Architect of the Department of Architecture Kazi Golam Hasib and Chief Engineer of Public Works Department Mohammad Rafiqul Islam besides others.

 “Housing Finance Fair starts from 19th October”

Date: 11 October 2017

Source: Poriborton

The article highlights Housing Finance Fair 2017 which started from 19th October 2017 in the capital city of Dhaka. The three day fair was arranged by Bangladesh House Building Finance Corporation (BHBFC) in association with REHAB to encourage real estate investment by the locals and non-resident Bangladeshis to boost the real estate sector of Bangladesh. The fair had reputed financial institutions, banks as well as real estate developer companies in Bangladesh in its participant list. On the occasion of the fair, BHFC introduced five new products among which are “nogorbondhu”, “probashbondhu” etc for different customer segments. BHBFC Managing Director Debashish Chakrabarty stated that the institution would provide loans with single unit interest rate and the fair would have 50% discount on loan application fee. REHAB Director Kamal Mahmud, Acting President Nurun Nabi Chowdhury and Vice President Liakat Ali Bhuiyan were also present in the ceremony among others.

“Realtors demand loan facility for flat registration”

Date: 12 October 2017

Source: Khobor Protidin

The article features a press conference by Bangladesh House Building Finance Corporation where REHAB realtors spoke for the need of loan facility for flat registration when buying apartment. The organization also demanded the interest rate to be lowered to 7.5% for real estate loans.

Acting President of REHAB, Nurun Nabi Chowdhury Shaon stated that the registration fee for buying a flat is 14%, which means if someone were to buy a flat worth TK 1 crore, he would have to pay Tk 14 lac as registration fee. Several apartment buyers are buying flats with the aid of home loan and settling down but they are not registering their apartments because of the high registration cost. This is why if loan facility is given for the registration purpose, number of apartment registration as well as Government’s earning would increase.

The realtors also demanded home loan interest rate to be lowered to 7.5% stating that in other countries around the world, the highest interest rate on home loan is 5%. On the other hand, the interest rate on home loan in our country is almost double and sometimes even greater than that. With low-interest rate, more people would be able to buy flats and it would also revive the real estate sector of the country. Apart from these, the realtors claimed that the loan application process has to be made easier and related troubles faced by loan applicants have to be discontinued to improve the current situation.

“Ensuring Construction Safety in Bangladesh”

Date: 12 October 2017

Source: The Daily Star

The article features a roundtable discussion titled “The Way Forward to Ensure Construction Safety in Bangladesh” organized jointly by The Daily Star and real estate company Sheltech Pvt Ltd. The discussion was geared towards raising awareness about construction safety for construction workers. The article cites that although construction sector is a key driver in the economic growth and development of Bangladesh, the workplace safety issue of construction workers is often overlooked for a multitude of reasons such as absence of national monitoring system to see construction safety practices, negligence of developer companies to implement construction safety, lack of safety awareness among workers as well as in the society.

Dr Toufiq M Seraj, Managing Director of Sheltech stated that the private construction sector in Bangladesh has reached a high level of professional competence and now has the capacity to ensure full compliance with international standards. Even though the industry has steadily improved on quality control at construction sites, much work still needs to be done to ensure the safety of construction workers.

Several recommendations were placed in the discussion to ensure construction safety including monitoring system by Developer Company itself, site and worker specific customized training for safety practices, regular safety training as well as incentives to promote practice of safety guidelines by the contractors, engineers and workers. Also present in the roundtable session were Dr AFM Saiful Amin, Professor, Civil Engineering Department, BUET, Syed Sultan Uddin Ahmed, Executive Director, BILS, Ar. Mubasshar Hussain, Former President, Institute of Architects Bangladesh besides others.

“Rentals give impetus to Real Estate, surge by 5% in 8 major cities”

Date: 31 October 2017

Source: NDTV Profit

The article features the real estate market condition in major Indian cities where housing prices have increased by 2% and rentals increased by 5% during July-September quarter. The data was collected by realty portal 99 acres. As per the article, housing prices in Mumbai were steady while rentals increased by 2%. On the other hand, in Chennai housing prices increased by 1% and rentals increased by 2%. Pune witnessed no rise in housing prices but rentals increased by 2% and in Kolkata, housing prices and rentals rose by 1% and 2% respectively. Narasimha Jayakumar, Chief Business Officer, 99acres.com expects the market to pick up pace in the festive season with favorable interest rates and policy reforms.