The start of the year also saw the REHAB Fair 2019, which stated that over 28,000 prospective buyers had visited and booked property worth around Tk1,500 crore
Last year was no doubt a busy one for real estate in Bangladesh. Factors from the previous year played a heavy part in the development of the industry, obviously, but a lot happened that was unexpected to some extent considering the trends of the previous years.
As expected, at the start of 2019, the bulk of demand for real estate in Bangladesh was heavily focused in the Dhaka region. Of the total, 98% of all demand was for Dhaka, with only 2% focused on the rest of the country. The country saw a new addition to cost in 2019 with 15% of an apartment’s cost was to be further paid as a registration fee. This was an incredibly high amount considering the existing interest rate was already a concern in the previous year, where it rose from 8.5% to 11% in the course of a year.
The start of the year also saw the REHAB Fair 2019, which stated that over 28,000 prospective buyers had visited and booked property worth around Tk1,500 crore. It was a curious thing, considering the financial impacts of the year before. But the fair showed that demand for real estate could persevere even through multiple hampers.
According to the Bangladesh Bank, till September, home loans were about 10% of the private sectors’ total credit. Though interest is much higher than most people are happy with, they continue to take them. Home loans are a great way for enthusiasts to enter the market as the demand for home ownership cannot be refuted.
And this can be seen as fairly true. In March 2019, statistics showed that over the last half-year, demand for real estate had increased drastically, by as much as 30% by some accounts.
Opportunities and land
There can be many reasons for this increase. February and March had discussions that showed chances of VAT and tax reduction as an initiative to develop the secondary real estate market. Though just chances at that time, it did a lot to boost confidence of the investors.
Then there is the matter of Purbachal New Town. With more time passing by and further development of the area, demand is definitely on the rise. Visible progress of the area bolsters belief that things are heading in a positive direction. This, in turn, has led to the race to claim what little free land remains — though statistics tell us there is close to none. So what is going on?
With a reduction of VAT and tax and progress of the area, enthusiasts are looking for land in the secondary market. But Purbachal New Town is not the only project in the vicinity. Many other projects have popped up to capture the attention of these investors. And the spill-over of New Town is definitely showing.
Projects like Marine City and Bproperty Village, which were fortunate enough to secure space right next to the New Town project, are benefiting the most. With wonderful plot layouts, tons of facilities and amenities, and great proximity to the government development, investors are readily snatching up land in the area.
The cost of many building products — not to be confused with construction material — has dropped as well. Prices of products like lightning arrestors, fire-safety equipment, wiring and regular house appliances, such as lights and fans, have decreased a little — enough to make a small saving when purchased for multiple projects or flats.
Last year has also been of great technological inclusion for the real estate sector. Pioneering companies like Bproperty paved the way for many smaller companies to emerge offering basic facilities, such as property search. This has made looking for the right property easier for many who were once afraid to enter the market in fear of the dreaded broker scam.
Many fairs and events also took place throughout the year with special offers that encouraged people to wander into the real estate scene. Perhaps without these kinds of offerings, many would be unable to partake in the realization of their dreams of owning a home of their own.
Overall, 2019 has been a good year for the real estate industry — with a few bumps here and there. We can only speculate on the conditions of the market and industry this year, but if 2019 is any sign of things to come, we can expect only more growth.