What could be the impact of a simpler project approval process? Read the February 2018 update to find out.

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March 7, 2018 Real Estate Industry

“bti celebrates 35th anniversary”

Source: Dhaka Tribune

Date:  27 February, 2018

Building Technology and Ideas Ltd. – a real estate company in Bangladesh- celebrated its 35th anniversary on 27th February, 2018. Programs were held at bti’s Dhaka, Chittagong, and Comilla branches to mark the occasion. All employees of bti, including Managing Director FR Khan, took part in the celebration, with this year’s theme being “Celebrating the fulfillment of our dreams.”

“REHAB fair begins tomorrow in Chittagong”

Source: The Daily Star

Date: 7 February, 2018

The article features a four-day real estate fair at the Radisson Blu Chittagong Bay View in the port city, starting from 8th February, 2018. The fair was organized by Real Estate and Housing Association of Bangladesh (REHAB). Chairman of Chittagong Development Authority (CDA) Abdus Salam inaugurated the fair where 59 real estate, building materials, and finance companies participated. Md. Abdul Kauiam Chowdhury, REHAB Vice President, demanded at a press conference in Chittagong Club that the government facilitate the availability of Tk 20,000 crore as housing loans and make the interest rate a single-digit one to boost the real estate sector and fulfill homeownership dreams of the low and middle-income segments. The fair was co-sponsored by 21 realtors and featured a total of 83 stalls.

“Housing sector sets for turnaround”

Source: The Independent

Date: 8 February, 2018

The article features the revival of the real estate sector of Bangladesh in the last few years. The growth of the real estate sector is attributed to the single-digit interest rate on home loans, increased interest of buyers to invest in the real estate sector, and so on. However, realtors stated that the sector would be further bolstered if the registration fees of flats and plots were reduced as this would facilitate the middle-income people to buy flats and plots. The realtors demanded an incentive of Tk 20,000 crore as housing loan for fulfilling the dream of accommodation of the lower and middle-income segments.

Real Estate and Housing Association of Bangladesh (REHAB) members said that the real estate entrepreneurs have doubled their investment in this sector in the last five years. The table below shows the increase in real estate investment in Chittagong over the last 5 years.

Year Real estate investment (in Tk.)
2013 3,500 crore
2014 3,750 crore
2015 4,000 crore
2016 5,000 crore
2017 6,500 crore

 REHAB Vice President and Chittagong Regional Committee Chairman Abdul Kauiam Chowdhury said, “The housing and real estate sector has set for turnaround.” However, he urged the government to reduce the registration expenses from 16% to 7% as the present registration expense in Bangladesh is much higher compared to that of other countries.

“Get discount when you buy any flat”

Source: Prothom Alo

Date: 9 February, 2018

The article features the highlights of four-day REHAB fair held in the port city, inaugurated by the Chairman of Chittagong Development Authority (CDA) Abdus Salam. The fair had a total of 42 real estate companies, 7 banks and financial institutions, and 10 construction material companies. Various real estate companies showcased around 200 projects with special offers in the fair to boost flat sales. REHAB President Alamgir Shamsul Alamin presided over the inauguration ceremony while REHAB Vice President and Chairman of Chittagong Regional Committee- Abdul Kauiam Chowdhury- gave the welcome speech. Realtors at the fair urged the CDA to simplify the project approval process through having a one-stop service center to remove the existing bureaucratic process and speed up the process. bti, Navana Real Estate, Zumairah Holdings Ltd, ANZ Properties besides several other real estate companies were participants in the fair. bti showcased ten projects in various locations of Chittagong like Khulshi, Hillview Housing Society, Panchlaish, Nasirabad, OR Nizam Road, besides others. The flat size of the projects ranged from 750 sft – 4653 sft. Md. Mahmudul Haque- head of operations at bti- stated that when buying an apartment, customers look for timely handover and quality of construction, and so far bti has had no complaints in these two areas. Meanwhile, Navana Real Estate presented five projects at the fair in North Khulshi, South Khulshi, Mehdibag, and Nasirabad.

“Project approval process has to be simplified”

Source: Kaler Kantho

Date: 18 February, 2018

The article features an interview with Mr. Sadi-Uz-Zaman, who is the managing director of Notundhara Assets Ltd. In the interview, Mr. Sadi-Uz-Zaman commented that it is necessary to simplify the project approval process for speeding up the real estate industry. He demanded to have a one-stop service center for the real estate sector. He further stated that the investment in 269 sub-sectors would be under threat if there is no effective action to overcome the crisis of the real estate industry, and the country’s economy would also come under turbulence.

When asked about the reason for the lack of reliability of customers in the real estate sector, Mr. Sadi-Uz-Zaman spoke that due to a number of companies that are not fulfilling commitment to the customers, many customers are losing faith in the entire industry.  He said it is difficult to earn the confidence of the buyer even with special offers.

According to Mr. Sadi-Uz-Zaman, about 36,000 ready apartments are currently unsold and the number is increasing daily. He stated that many members of his organization have to travel round the clock for getting the approval of a project. Moreover, without the approval, the company cannot run any marketing campaigns. If the approval process is so complex, then the transfer of the project becomes complicated too. He further commented that government support is required for those companies that truly want to serve the real estate sector, and for this, the law and the funding should be made easy.

Commenting on the current registration fee, Mr. Sadi-Uz-Zaman spoke that the rate is incredibly high with 15.5% as VAT-TAX in the registration fee. He said that this discourages people to register their flats. As a result, the government is losing revenue.

 “Obstacles in investment lead to trafficking money abroad”

Source: Kaler Kantho

Date: 22 February, 2018

The article features the lack of investment of undeclared money in Bangladesh due to which many people are making investments abroad. In Bangladesh, although the National Board of Revenue (NBR) has given the opportunity to invest undeclared income with a penalty in the form of paying tax, investors are still scared to invest the undeclared money because of inquisition from the ACC at any time. Many Bangladeshis are buying flats, houses, and lands in different countries such as Malaysia, Thailand, Singapore, etc without purchasing flats in the country. As a result, real estate sector in Bangladesh is suffering and many developer companies have a huge number of unsold ready flats.

REHAB’s vice-president Liakat Ali Bhuiyan said that many people fail to show a certain amount of money in the income tax. For instance, a rural person might have sold a land without including it in the income tax. Later, when he came to buy flat with the money, the ACC wanted to know about his income source but he could not provide any proof. In such cases, many people are not able to buy flats in the country even with legitimate income. As a result, they are forced to traffic the money abroad. Mr. Liakat Ali recommended that everyone should be given the opportunity to invest undeclared money in the housing sector without any penalty or any form of inquisition. This will mitigate the buyer’s fear and reduce investment in foreign countries.