Describing the current bearish trend of the real estate sector a ‘transitory slowdown’, consultancy firm Ernst and Young said that the outlook of the sector is still ‘positive’ in the medium-to-long term.
“Ernst and Young believes that the market is witnessing a transitory slowdown. However, considering the opportunities present as well as the strong economic fundamental drivers, the outlook for the mid-to-long term is positive,” it said in a report released at a Ficci-organized summit here.
The momentum of the market in the mid-to-long term would be sustained by the emergence of new markets, innovative products, ongoing corporatisation of the sector, integration with global markets, greater transparency and new funding mechanisms, it said.
The real estate sector is set to grow by 100 times in the next ten years as compared with the past 10 years, though profit margin would be less, said Hiranandani Group of Companies Managing Director Niranjan Hiranandani.
“The age of super-profit is over for the real estate sector and developers will have to remain content with low profit margins. If you do not believe in this and keep on waiting, somebody else will take business away from you,” Hiranandani said.