Ctg Fair 2012 Survey Result

Delivering Survey Report Key findings in the REHAB Chittagong Fair 2012

DurationofSurvey:10/02/2012(starttime:15PM)to11/02/2012(20PM)

Survey design and conducted by: LeoVashkorDewri,ResearchManager,REHAB.

Report: 1

REHAB Chittagong Fair 2012 - Survey Report

Respondents: VisitorsoftheREHABChittagongFair2012.

Objective of the survey: ToascertainthePotentialCustomersnature,affordabilitytobuyapropertyandlocationpreferenceandmanymore.

Survey 1


TopicsA:CustomersatisfactiononREHABChittagongFair2012

QuestionAsked:HowwouldyouratetheoverallarrangementofREHABChittagongFair2012?

Objectives of the Question: The purpose of this question was to investigate the satisfaction level of

individualcustomeraboutoverallFairarrangement.

Distributionofrespondentsasperlevelofsatisfactions:

Table1:Customersatisfactionlevel

Chart1:Customersatisfactionlevel

Comments:Fromtheabovesurvey itwasevidentthatmajorityofthevisitorswerequitesatisfiedwiththeoverallarrangementoftheChittagongFair.Mostofthevisitorsopinedthatparticipationofmoredevelopersfirmscouldincreasewiderknowledgeaboutmoreproductsandservicesandmakethefairmoreattractive.

Highlevelofsatisfactions 67%Moderatelevelofsatisfactions 32%Lowlevelofsatisfactions 1%


TopicsB:Typesofvisitorsasperpurposeofvisit.

Questionasked:WhywouldyouliketovisittheChittagongREHABFair2012?

ObjectivesoftheQuestion:TojustifythepurposeofvisitingREHABfair.

1 Window shopping

2 Get an idea about various developers

3 Get an idea about various products

4 Planning to buy Flat

5 Planning to buy Plot

6 Get an idea about various developers for future buy Flat

7 Get an idea about various developers for future buy Plot Table2:Purposeofvisiting

Distributionofrespondentsasperpurposeofvisit:

Chart2:Purposeofvisiting

*Note:FollowtheabovetableforPiechartNumberandcolordefinition

Comments:Itwasevidentfromtheabovesurveythat63%ofthevisitorswerepotentialbuyersofFlats/Plots(majority intendedtobuyFlats,which is58%).Asizeablenumberofthevisitors(21%)wantedtogetan ideaabouttheproductsandservicesforfuturepurchase.


TopicsC:DemandofFlat/Plotsizeandpreferredlocationtobuyaproperty.

Questionasked:WhatsizeofFlat/Plotwouldyouliketobuy?ObjectivesoftheQuestion:Investigatewhatflatsorplotssizesweremoredemandedinmarket.Flatsize

Flatsize 850to1200sft

1500to1700sft

2000+sft

Demandofpercentage 35% 63% 2%

Table3:DemandofFlat

Chart3:GraphicalpresentationofDemandofFlat

PlotsizePlotsize 3Katha 5Katha 5+Katha

Demandofpercentage 51% 47% 2%

Table4:DemandofPlotsize

Chart4:GraphicalpresentationofDemandofPlotsize


Comments:

Flat:

Fromthissurvey itwasquiteapparentthatmajorityofthepotentialbuyers(63%)are interestedtobuymidsizeFlatsi.e.1500sftto1700sft,while35%wereinterestedtobuycomparativelysmallersizeflatswhichwasbetween850sftto1200sft.Howevertherewasaslightmissmatchwiththeexpectationandrealcapabilitiesforbuyingapropertyasevidentfromthenextsurveyquestion.

Plot:

Fewvisitorsrespondedthattheywereverymuch interestedtobuyPlotbetween3to5katha.Similarly,17%visitorswereinterestedtobuyeitherFlatorPlotorboth.

TopicsD:Demandandchoiceofvariouslocationstobuyaproperty.

Questionasked:WhatlocationorareawouldyouprefertobuyaFlatorPlot?

ObjectivesoftheQuestion:Identifythemostpreferredlocationtobuyaproperty.

Sl.no.Location

Chittagongpercentage

Coxbazaarpercentage

Dhakapercentage

1 CityCentrearea 54% 86% 80%2 Closetocitycenter 35% 7% 20%3 ExtensionCityarea 9% 7% 4 Satellitecityarea 1% 0%

Table5:Demandandchoiceofvariouslocationstobuyaproperty

Comments: Itwasquiteapparentthatmajorityofthepotentialbuyersstillaspiretoownapropertywithin

theCitycenter.ThisclearlyreflectthatalthoughthebuyingpowervisvisowningapropertyintheCitycenterhaddecreasedsignificantlyduetolowsupplyoflandandhighconstructioncost,butthegeneralmindsethasnotbeenyetchange.Peoplearestillreluctanttomoveawayfromthecitycenter.


TopicsD:Decisiontimetaketobuyaproperty.

Questionasked:Whenwouldyoufinallydecidetobuyaproperty?

ObjectiveoftheQuestion:Forthissurveytherespondentswereaskedaboutthelikelytheirtimelinewhentheywouldeventuallybeabletotakeafirmdecisiontobuyaproperty.

Timelinetomakedecisiontobuyaproperty PercentageImmediate 25%3monthstime 18%6monthstime 24%AYeartime 33%Others(5yearsormore) 1%Table6:Timelinetobuyaproperty

Comments: It has been found that only 25% of the respondents were in a position to make immediatedecision while rest would take some time between 3 to 11 months to make firm decision. This is quitesignificantthatthepointofviewofdeterminingthetimeneededtoeventuallycloseadeal fromthe firstofcontactfirm.

TopicE:SourceofFundtoinvestinproperty.

Questionasked:Whatisyoursourceoffund?

Objectivesofthequestion:Inthissurveytherespondentswereaskedabouttheirlikelysourcesoffundtobuyaproperty.

FinancingInstrument PercentageofFundingPersonalSavings 31%FamilySavings 23%ForeignRemittance 23%MortgageFinance 23%Others(Business) 1%

Table7:SourceofFundtoinvestinproperty


Chart5:GraphicalpresentationofSourceofFundtoinvestinproperty

Comments:Approximate54%ofthetotalrespondentswillusetheirpersonal/familysavingstopurchasetheirproperty.InterestinglymajorityofthemalsointendtoownapropertyintheCitycenter.Itseemsthatthesegroupsofpeoplearefinanciallyrobust.Aboutaquarter(23%)oftherespondentsrevealedthatforeignremittancewouldbetheirfinancialsourcetobuytheirdreamhome.Theyintendedrathertobuyaflat/plotofslightlybiggersizewhichiseither1500sftto1700sftand5Kathaorabove.Apparentlytheyhaveconsiderablefundavailable. About quarter (23%) of the participant intended to buy a property through sourcing mortgagefinancing.Theirintendedsizeofthepropertyisalsoquitemodest,whichiseither850sftto1200sftofflat size or 3 katha of land. They are also not very choosy about location. This segment of thepopulationclearlydoesnothaveoutrightcapacityofpurchasingaproperty.Thissignifiesthatthesegroups of people have quite low capabilities to finance themselves to buy a property. In thiscircumstance, Bangladesh Bank loan schemewith low interest rate (9%)would be the alternativefinancingmethodologythatwouldbeappropriatetosolvetheir.


TopicF:CapabilitiestoinvestonbuyingaflatorplotQuestionasked:HowmuchwouldyouliketoinvesttopurchaseaFlatorPlot?Objectives of the question: In this survey the respondents were asked to mention their purchasecapabilities.

InvestmentAmountBDT Percentage

4,000,000 33%5,000,000 49%7,000,000 10%10,000,000 4%

Other 5%Table8:Purchasecapabilitiesofpotentialbuyer

Chart6:GraphicalpresentationofPurchasecapabilitiesofpotentialbuyer

Comments:Majorityof thebuyers (82%) realpurchasepower isnotmore thanBDT5millions in termsofbuyingaproperty.Thisinformationisquiteimportantintermsofplanningfutureprojectsintermoflocationandsize.


Respondents: DevelopercompaniesthosewereparticipatedintheREHABChittagongFair2012.

Objective of the survey:

Toascertainthenature,extentandcausesoftheongoingsleepintheRealEstateSector.

Survey 2


TopicsA:PresentmarketconditionoftheRealEstateBusinessBangladesh.

QuestionAsked:HowwouldyouratethecurrentbusinessconditionofRealEstateSectorinBangladesh?

ObjectivesoftheQuestion:ThepurposeofthisquestionwastoinvestigatethecurrentmarketsituationofRealEstatesectorinBangladesh.

DistributionofrespondentsasperlevelofunderstandingofBusinesssituation:

Table9:Developersresponderspresentmarketcondition

Figure7:DevelopersresponderspresentmarketconditionComments:78%RealEstateandlanddeveloperswerequitepessimisticaboutthepresentmarketsituationandtheythoughtthatthisbasicsectorofeconomywasexperiencingarecessionlikesituation.Asmallpercentage(22%)ofrespondentsfeltthatmarketsituationremainedunchangedforthelastcoupleofyears.ThisindicatesthatthereisawidespreadperceptionofarecessionintheRealEstatesectorinBangladesh.

PresentMarketsentimentPercentageofvarioustrendHightrend 0%

Moderatetrend 22%

Lowtrend 78%


TopicB:FuturetrendoftheRealEstateBusinessinBangladesh.

QuestionAsked:HowwouldyouratethefuturetrendsofbusinessintheRealEstateSectorinBangladesh?

ObjectivesoftheQuestion:ThepurposeofthisquestionwastoinvestigatethefuturetrendofRealEstatesectorinBangladesh.

Distributionofrespondentsasperlevelofunderstanding:

Table10:Developersrespondfuturemarketcondition

Figure8:DevelopersrespondFuturemarketconditionComments:Approximateby50%respondentrepliedwithnegativeapprehensionthatfuturetrendoftheRealEstate business would remain slow as in the present. About 37% respondents were fairly confident thatbusinesswouldrevivetoamoderatelevelwhile15%developerswereexpectinghighergrowthinfuture.

FutureMarketsentimentPercentageofvarioustrendHightrend 15%

Moderatetrend 37%

Lowtrend 48%


TopicsC:Effectonsigningnewprojectduetorecession.

QuestionAsked:Comparethesigningofnewprojectintheyear2010and2011?

ObjectivesoftheQuestion:Thepurposeofthisquestionwastoinvestigatethepossiblenegativeimpactonsingingnewprojectduetorecession.

ContractsingingforNewprojectsbetween2010to2011byDevelopers

2010 2011

No.Ofprojects181 180

Table11:NumberofNewProjectsign

Figure10:Numberofprojectsign

Comment:Itisquiteinterestingthatnumberofsingingprojectsremainedsamein2011asin2010.Itseemsthatinvestorswerenotverymuchawareofthecomingrecessionin2011.


TopicsD:Numberofflatsready,soldandhandedoverintheyearof2010and2011.

QuestionAsked:Pleasegivecomparisonofsalesandhandoverbetweentheyear2010and2011?

ObjectivesoftheQuestion:Thepurposeofthisquestionwastoinvestigatethenegative/positiveimpactonflatsalesandhandedovercauseofrecession.

NumberofFlatsavailable,soldandhandedover 2010 2011 Change Percentage

No.offlats 2010to2011NumberofReadyflatsforsale 2968 3336 368 12%NumberofFlatsold 1005 844 161 16%NumberofFlatHandedover 393 382 11 3%

Table12:BusinessdevelopmentpositionofRealEstatein2010and2011

Figure11:BusinessdevelopmentpositionofRealEstatein2010and2011Comments:Basedonrespondentsopinion,thiswasbeingobservedthatnumberofflatsaleshaddroppedin2011comparedto2010whichwasapproximately16%inthenegativeside.Ontheotherhand,flatsreadyforsales increasedby12%asdeveloperssigned theseprojectsat least3yearsbefore. Numberof flatshandedoveralmostremainedunchangedin2010to2011.


TopicsE:ReasonforapparentsleepintheRealEstatesectorin2011.

Question Asked: What were reasons for slowing down of the sector in real estate business in 2011comparedto2010?

ObjectivesoftheQuestion:Thepurposeofthisquestionwastounderstanddevelopersperceptionreasonsforrecessionintherealestatebusinesslastcoupleofyears.

ReasonfordowngradingtheRealEstatebusiness:Reasons PercentageofRespondentsGlobalrecession 10%StockMarketcrash 15%Withdrawalofsection19(B) 10%StoppageofBBSchemeoflowinterestloan 11%Highinterestrateinrealestateloan 10%Inadequateloanfinancingbylenders 12%Priceincreaseinlandandflat 9%Unavailabilityofutilityconnections 15%Inflationresultingdepressedbuyingpower 9%Table:13:DevelopersresponsereasonsfordeclinebusinessintheRealEstatesector

Figure12:DevelopersresponsereasonfordowngradingtheRealEstatebusiness

Comments: Majority of respondents opined that stock market crash (15%) and unavailability of utilityconnections(15%)werethemainreasonsforslowingdownoftherealestatebusinesswhichwasalsoevidentfromthecustomerscommentsinanothersurvey.Fewotherreasonswerealsohinderingtheoverallbusinessgrowth i.e. inadequateloanfinancingby lenderswithveryhigh interest(12%),unavailabilityof loanfinancingbyBangladeshBankforlowearnersetc.


TopicsF:PossiblemeasuresthatmaybetakentorevivetheRealEstatebusinessinfuture.

Question Asked: What were possible measures to revive the real estate business from the ongoingrecession?

ObjectivesoftheQuestion:Thepurposeofthisquestionwastofindoutdeveloperssuggestioninordertocomeandoftheongoingrecession.

Possiblesolutions:A.IntroducelowinterestratebasedcreditfacilitiesforRealEstatesectorbyBangladeshBankB.ReintroductionoftheSection19(B)C.IncentivePackagetosustaintheRealEstatesectorbyGovernmentD.ApprovalofprivatelanddevelopmentprojectstoincreasesupplyoflandfordevelopmentE.GovernmentsspecialschemeforprovidingaccommodationtolowearnersunderPPP

ImportantfactorstosustaintheRealEstatesector(Percentage)A B C D E

21% 20% 21% 20% 21%Table14:Possiblesolutionbasedoncustomerfeedback

Comments:Itwasinterestingthatrespondentdevelopersfeltthatalltheabovefactorswereequallyimportanttosustaintherealestatebusinessinfuture.Besides,developerswerealsoseekinghelpfromGovernmentsintheformofaincentivepackagetorevivetheRealEstatesectorfromthecurrentdecliningsituation.

TopicsG:AveragepriceincreaseofflatsindifferentlocationsbasedonthreedifferentcategoriesA,BandC.

OpinionAsked:Shareyourexperienceonincreaseofpriceofflatsofvariouscategoriesinthelasttwoyears

ObjectivesoftheQuestion:Thepurposeofthisquestionwastoinvestigatetheaveragepriceincreaseratioofapartmentsofthreecategoriese.g.high,middleandlowermiddleearners.AveragePriceincreaseinthethreedifferentcategoriesofFlat(A,BandC)between2010to2011

Location Year2009to2010 2010to2011

PercentageincreaseA

(Prime) 35 39B

(Middleearnerclass) 28 29C

(LowerMiddleearner) 23 20

Table15:PercentageofincreasingofFlatPricefrom2009to2011


Figure13:PercentageofincreasingofFlatPricefrom2009to2011

Comments:Majorityofrespondentsstatedthatpropertypricehadbeencontinuallyrisinginthelastcoupleofyears.Respondents indicatedthat increasepriceof landandconstructionmaterialswerethemaincausesofthisphenomenon.


Copyright @ REHAB Disclaimer: This survey report prepared based on Chittagong REHAB Fire 2012 participants members and visitors of the Fair. And this survey report is being prepared to distribute to all REHAB members. The contents of this document are protected by copyright. No part of this document may be reproduced in any form without prior permission of REHAB.

Whatsnext?

REHAB initiates a large research project to investigate the pos and corns of thewhole sectors to bring out thepossiblesolutionstokeepsustainablegrowthoftheindustry.ByfollowingthisREHABresearchteamwillpursueforadetailssurveytoextractwiderspectrumofproblemsthosearefacingbyRealEstatebusinessorganizations.

Contact:

REHABNATIONALPLAZA(6thFloor)1/G,FreeSchoolStreet,SonargaonRoad,Dhaka1205.Bangladesh

Phone : 88029662482

Email:[email protected]

Ctg Fair 2012 Survey Result

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