Demand for Budget Aprt in Kochi after Recession in Gulf

kochiKOCHI: The economic slowdown in the Middle East and uncertainties faced by the Malayali diaspora have led to an increase in demand for budget homes.

The non-residential Keralite (NRK) and Gulf returnees are now more cautious about their investments, which has created a dent in the demand for premium and luxury segments in the city.

City-based builders and architects said there were more takers for apartments in the 800-1,500 sq ft range, costing between Rs 40 and Rs 60 lakh.

B R Ajit, chairman, Indian Institute of Architects (IAA), Kerala chapter, said the demand was too low in the city, particularly in the luxury and premium sector.

“Other than NRIs, people do not have extra disposable income that can be invested in premium projects,” he said.

With the government and taxmen tightening their grip on black money, the inflow of money into the sector has also declined. “Black money is one of the main sources of funding in the real estate sector. About 30 to 40% of the black money has gone out of circulation in the country. Simultaneously, investment in the sector has also gone down in the state as well as in the entire country,” added Ajit.

Jortin Antony, a city-based builder, said that Malayalis living in Gulf countries were either losing jobs or did not have secure ones. Even people residing in UAE and Dubai “are not interested in investing in anything which cannot be traded for liquid cash within a few days”.

“The recession in Gulf countries has prevented many NRIs from investing in extravagant projects. Employees belonging to middle and lower income groups, who are returning from the Middle East, opt for budget homes or apartments,” said architect L Gopakumar.

Source : ET realty