Property

Bikroy.com arranges the first webinar on the real estate sector of Bangladesh

Last June, the first webinar session of Bikroy.com was aired on “The impact of COVID-19 on the Real Estate Sector of Bangladesh, and what buyers and sellers should do”. The event featured some established and well-known personalities in the real estate sector of Bangladesh. The attendees were – F.R Khan, Managing Director of Building Technology & Ideas Ltd. (bti), Hossain Khaled, Managing Director of Anwar Landmark Ltd., and M. Arifur Rahman Sajal, CEO of Assure Group. On behalf of Bikroy, Eshita Sharmin, Co-Managing Director of Bikroy.com also joined the conversation. The webinar, which lasted for about an hour and a half, was hosted by Emdadul Haque (Mobin), Head of Property at Bikroy.com.

Property Market Trend as per Bikroy Data

The conversation started with observed trends in the property market, based on the data obtained from the Bikroy.com website. According to that data, the growth rate of sellers from April to May has increased by 57% in the past year. The total number of users in the property category has increased by about 15%. The number of interested buyers who contacted the sellers increased by about 10%. Page views in the property category alone were about 10 million. Also, the number of sessions was around 6 lacs, and the average time spent by the visitors in the property category was more than 8 minutes.

The Impact of COVID-19 on the Real Estate Sector and Tips for Sellers and Buyers

On this topic, F.R Khan, Managing Director of Building Technology & Ideas Ltd. (bti) said that since 2018, the market price in the real estate sector in Bangladesh has been at a fairly stable level. The biggest challenge with COVID-19 is that it has spread globally and we cannot tell exactly how long its effects will last. Therefore, established developers with a reputation of handing over quality projects to the clients do not have opportunities to make much profit due to the increased price of imported raw materials, and that limits the scope of price reduction for them in the future. He is hopeful, however, that the real estate sector will return to normalcy within the next six months if the Government can provide financial back-up to developers at low-interest rates through the banks. At the same time, he urged the landowners to keep their expectations consistent with the current market value.

When asked to comment on the same, Hossain Khaled, Managing Director of Anwar Landmark Ltd., said buyers would benefit as soon as the Government implements stimulus packages to boost their purchasing power. If banking and non-banking institutions provide financial schemes worth BDT 5,000-10,000 crore for both urban and rural areas, consumers will be able to invest more easily in the real estate sector. In this case, he suggested increasing the amount for home loans, in which people are generally more interested. Above all, he urged customers to connect only with established developers.

When asked about this, M. Arifur Rahman Sajal, CEO of Assure Group said that it would cost even more to hand over quality projects to the clients, in which case the scope and chances of reducing the price are very minimal. They ensure virtual tours, send regular site updates via email, and additional security for visitors and workers in order to deliver ongoing projects to clients as committed. At the same time, he sought coordination among all the partners. Like the other two guests at the event, he spoke about the role of the Governments and banks in encouraging buyers to invest. He said that if the developers were given lower interest rates for carrying on with daily and monthly working capital in the next six months, it would be easier to continue working on the projects. He also added that buyers who are aware of the security of investing in the real estate sector and the appreciation rate would definitely invest in the property market.

Q/A Session

Some from the audience had questions for the attendees. Below is the summary of the Q/A session:

Question 1. What would be your suggestion for SME level real estate developers?

Answer: F.R Khan, Managing Director of Building Technology & Ideas Ltd. (bti) advised to continue the existing projects without working on any new projects at this stage. He also advised them not to lower prices irrelevantly and abnormally out of fear as it would be a problem for all players in the market. He also advised them to take a little more time from the clients and a little more equity from the banks to continue the project in the current situation.

Question 2. Is there any possibility of increasing demand for ready flats in comparison to under-construction projects after COVID-19?

Answer: Answering this question, Hossain Khaled, Managing Director of Anwar Landmark Ltd., said that interested customers can decide according to the ranking system for developers that banks prepare. Besides, banks have home loan facilities to encourage customers to invest. At this stage, investors should evaluate their assets. So if the customers have disposable income, then they must invest in this sector. It could be anything from a ready flat, an under-construction project, or land.

Question 3. What should developers do to attract customers at this time?

Answer: When asked about this, M. Arifur Rahman Sajal, CEO of Assure Group said that developers should only get involved in new projects after valuating the working capital and financial back-up at hand. If those living in rented houses are interested in paying the installment by adding some more money with the rent, they will have their own flat which is a permanent property. Before starting work with a developer, clients should check their name and reputation in the real estate sector, their handed over projects, ongoing projects, financial partners, etc.

Question 4. Now that Below The Line (BTL) marketing is off, what marketing strategy should developers adopt?

Answer: In response to this question Eshita Sharmin, Co-Managing Director of Bikroy.com said that online marketing is the most effective medium at this moment. Developers now need to increase their digital presence to attract buyers. At the same time, they should enlighten the customers that in the current context the pricing in the real estate sector is not unreasonable. And the real estate sector in Bangladesh is always appreciating. We need to build this confidence among the buyers.

In response to the same question, M. Arifur Rahman Sajal, CEO of Assure Group said that real estate players should now smartly redefine their business strategy. In addition to photos, 3D models, walk-through videos can be made to attract customers. He also urged the marketplaces present in the secondary market to conduct live sessions in ready flats. He also suggested them to assess and rank the developers on the basis of manpower, investment capacity, handed over projects, and financial back-up assessment for the next 3 years.

Question 5. What could be the current and future state of the real estate sector in cities or areas outside Dhaka, especially in Chittogram?

Answer: F.R Khan, Managing Director of Building Technology & Ideas Ltd. (bti) said that the construction price in Chittagong is always higher but the selling price is lower than that of Dhaka. So it’s quite difficult for developers to survive there. And developers have to take up more projects if they want to survive. Regarding Kumilla, he said that people there still believe in the concept of extended family and owning independent houses.

However, in order to decentralize the Dhaka city, he advised shifting the head offices of important sectors to the relevant district or towns such as the Navy Headquarters to Chattogram and the Fisheries Department to Borishal. He also informed about the possible development of downtown near Dhaka in the future where there will be other facilities including accommodation, people will come to Dhaka only for jobs.

Question 6. Now that many companies are closing down or shifting to small offices – what is the future of commercial properties?

Answer: When asked, Hossain Khaled, Managing Director of Anwar Landmark Ltd., said that sooner or later people have to go back to work. The demand for commercial property has always been there, so he hopes it won’t change too much.

Arifur Rahman Sajal, CEO of Assure Group said at this stage that it is high time for institutionalizing the real estate sector of Bangladesh where all companies will work together for the same goal.

Conclusion

This webinar was organized for the understanding of buyers and sellers regarding buying and selling property or new investment in the ongoing pandemic, and the future of the real estate sector of Bangladesh post COVID-19.

Visit Bikroy.com, the Largest Property Marketplace in Bangladesh today to rent, buy or sell flats, rooms, land, commercial property, and get related services.

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