Mumbai: Real estate prices have increased across the country with certain areas seeing prices going through the roof for both commercial and residential properties.
But with the real estate industry highly unorganised, prices are unregulated.
A research agency in Mumbai has now devised a Real Estate Sensitivity Index (RESSEX), which would track real estate prices and the factors affecting them.
ESTATE INDEX: The index, to be updated every quarter, factors price, availability and supply of real estate.
Fallout of the huge demand for and short supply of real estate has been spiraling prices, but till now there was no credible methodology for deciding real estate prices.
Lack of proper research and benchmarks has resulted in huge price variations. RESSEX is meant to change all this. It will take into consideration various factors like interest rate changes and Government policies to arrive at the final price of a property.
Says CEO Liases Foras, Pankaj Kapoor, "Depending on the availability of real estate, we can shortlist the location that gives more scope for appreciation where the money that is invested has more scope for growth."
The real estate industry has been growing at an average of 14 per cent annually.
The industry is currently worth $14 billion and is expected to reach $102 billion in the next 10 years.
Malls, premium housing and Multiplexes are fueling 50 per cent of the demand for real estate.
Says MD Orbit Group, Pujit Aggarwal, "A prospective buyer, banks, FDIs - whoever it will help is interested in real estate. RESSEX will evaluate on a scientific basis, the value of the land, or flat or office is.
Adds MD of K Raheja Universal, Ashish Raheja, "Today we do short term analysis on what our profits could be based on today's rates. But with RESSEX we would get projections for the next 15 years rates. If you are buying five acres, it does not matter, but if you are buying 50 acres or 80 acres, it would be important to track the future development of that area. They are scientifically giving what we were depending on our gut calls."
RESSEX will currently be tracking Mumbai region and giving quarterly reviews. But they plan to spread across India within the next one year.