Housing business 'booming' despite global recession

FE Team | Published: December 12, 2009 00:00:00 | Updated: February 01, 2018 00:00:00

Jasim Uddin Haroon
The country's realtors Friday said that their business had picked up sharply despite global recession due mainly to favourable provision on the purchase of flats in the national budget for the current fiscal.
The finance minister in his budget speech announced that undisclosed money could be invested in the housing sector and pledged that no government agency will ask buyers about their sources of income while buying apartments.
Stability in prices of apartments and building materials is also luring the flat buyers, the realtors claimed.
They also claimed that at least 2,000 additional flats would be handed over to the buyers by December.
"We generally hand over around 7,000 flats yearly to the buyers in Dhaka and Chittagong, but this year we expect to hand over around 9,000 flats," Real Estate and Housing Association of Bangladesh (REHAB) President Tanveerul Haque Probal told the FE.
"Our business started to grow from July this year as aspirant buyers got confidence after the finance minister's speech," Probal added.
Apartment sales hit the rock bottom in 2007 when a nationwide crackdown on corruption saw only about 3,000 flats sold.
"Buyers including non-resident Bangladeshis refrained from buying flats in 2007 and 2008 when the law enforcing agencies started asking questions about the sources of income of flat buyers," REHAB chief added.
The buyers avoided buying of flats during the period sensing harassment by the taxmen and other government agencies.
The chief of the REHAB, a group of 600 developers, said that they had sold flats worth around Tk 4.0 billion (400 crore) in a fair held in New York in October this year.
"We sold a very impressive figure of flats at the New York fair. That is to say, expatriate Bangladeshis who have been struggling due to economic meltdown and job cut in the USA are also keen to purchase flats in the major cities" Probal added.
Meanwhile REHAB officials said that some 265 developers would showcase their products at a fair to be held in the city in the first week of January next.
"This is a record in the number of developers at a fair to showcase their products which testifies to a boom in the business," Md Akter Biswas, deputy-managing director of Latif Real Estate, told the FE.
"Many buyers are now being encouraged to purchase apartments due to enactment of a new law relating to monitoring of the activities of the developers," Mr Biswas, also a senior REHAB official, added.
"The prices of raw materials, especially MS rod and cement, remained stable since January last. This also helped keep prices of flats stable," said FR Khan, managing director of Asset Development Holdings Limited.
Currently, the prices of apartment in posh areas are ranging between Tk 7,000 and Tk 9,000 for each square foot while it is between Tk 3,500 and Tk 5,000 each square foot in the suburbs and crowded areas.
The realtors said their housing projects are now spreading to other cities namely Sylhet, Comilla, Gazipur and Narayanganj.
"We are also getting good response from the buyers in the new districts. We need simply improvement of road communication," Probal added.
The country's housing sector has been growing on an average of 10 per cent. The housing and its allied sectors are contributing around 10 per cent to the country's GDP (gross domestic product).