Real estate developers are likely to invest Tk 50 billion in the housing sector over the next five years to cope with ever increasing demand for condominiums.
A large flow of demands for housing is coming from Bangladeshis living in the USA, UK and other parts of the world, sources with the Real Estate and Housing Association of Bangladesh (REHAB), told the FE.
The REHAB Fair 2005 will be held in Dhaka on November 23-27. Housing investors from Germany and Spain are expected to attend.
The developers are facing growing demand from customers at home as well, as land price goes sky-high and the construction cost soars.
After receiving 'pretty good responses' from Bangladeshis living in the USA and UK this year the developers are now targeting Dubai in the Middle East and Rome in Europe -- the two cities where a larger number of expatriates is concentrated. These non-resident Bangladeshis (NRBs) are willing to have their own apartments in Bangladesh.
Not only in the overseas market, the real estate developers have found that condominium projects outside Dhaka are also getting huge response.
The real estate and housing sector is contributing more than 12 per cent to the gross domestic product (GDP) and that it become the most labour intensive industry, after the apparel and clothing sector.
In May, a REHAB housing fair in New York, the commercial capital of the USA, netted Tk 1.25 billion in spot orders for apartments and another Tk 2.0 billion worth of orders are in the pipeline. Another fair in London in June has fetched Tk 400 million in spot orders with another Tk 800 million remaining in the pipeline, REHAB sources said.
"We did not expect such a nice feedback from the UK and America...We are planning to expand our market to the Middle East and other European cities where Bangladeshis live," said a senior the REHAB official. Currently, the REHAB members are building some 5,000 to 6,000 condominiums and are developing some 4,000 to 5,000 plots each year for individual housing purposes.
"Our annual turnover is worth Tk 12.50 billion. The government is getting tax and duties worth Tk 1.0 billion a year," said another REHAB official.
"People are leaning towards owning apartments simply because the monthly rent they are paying for apartments are equivalent to what they could pay for buying them," said Maksud A Chowdhury, owner of Foresight Development Concerns Ltd.
Maksud said unlike old days, people are now more comfortable with apartments because buying a piece of land and constructing a house on it seem to be pretty expensive.
As land in Dhaka becomes more precious, the developers are now expanding their projects to Sylhet, Chittagong, Comilla and even in Bogra town.
"Housing cost in those districts is comparatively low," said a REHAB official.
"I prefer to buy an apartment…it is quicker and affordable for us," said Sharmin Akhter Koli, an employee of an international NGO in Dhaka. She said she had saved some money, and, was taking some loans from a bank for buying one apartment in Dhanmondi area.