Good morning, fundraising in global capital markets sank by USD900 billion in Q1, 2022 over the same period last year, with the war in Ukraine, soaring inflation, and wild market swings putting the fear of god into folks planning to write those big checks.
While the capital markets go sshhhhh 🤫, bankrupt Indian developers with dynamites strapped around their high rise towers are making a racket via letters to the Chief Minister.
All this, while thousands of left-in-the-lurch homebuyers hit the streets demanding keys to their homes.
Welcome to FY23.
🏋️♀️🍌🥛
Housing Sales Touch 4-Year High In Q1, 2022
Has the Indian housing market got back its elusive mojo? Record-low interest rates, steady pricing and Government support have culminated in four-year-high sales figures between January and March.
Market Bytes
What Corona? Per this report, volumes have comfortably crossed pre-pandemic figures for the third quarter in succession.
Sample this:
📊 78,627units sold in the quarter (9% of year-on-year growth).
📊 Average 1-7% growth in capital values across top cities.
📊 78,171 newly launched units.
📊 India’s costliest housing market had its highest sales figures of 21,548 units.
📊 Delhi-NCR grew its sales and launches by 123% and 592% respectively.
📊 Bangalore sold 13,663 units while Ahmedabad grew by 34% to 4,105 units.
📊 Kolkata grew new launches by 141% too.
📊 Prices went up by 4-5% in the Mumbai-Pune stretch, while increasing by 7% in Bangalore.
Now, only if rising material costs do not throw a spanner in the works...
The US Housing Market Now
This Twitter gem aptly describes the American housing market today, where low housing supply, coupled with almost-nothing-mortgage-rates and high demand have made homes unaffordable, when available.
But here's the best part of the thread - a comment which reads, “Interest rates gonna drop an electric cattle prod into that pool soon.”
Virtual Greens To Boost Chinese Realty
Higher Government control and financial transparency may be at the heart of China’s newly-launched digital Yuan for real estate.
💡 Three projects just received USD87,000 worth of virtual green, courtesy of the Industrial & Commercial Bank of China and China Construction Bank wallets.
Pilots Galore
The 2022 Winter Olympics venues, Shenzen, Suzhou and Beijing had extensive digital money trials by the People’s Bank of China, and you can expect more upcoming digital Yuan applications for the 2022 Hangzhou Asian Games.
Shopping and dining? The Hong Kong Monetary Authority is on it.
Why Real Estate?
Mega realty player Evergrande has been facing trouble with loan repayments even before this newsletter saw the light of day, but China’s real estate boom seems all but over.
The digital Yuan could be a welcome revolution or dampener. Let’s see how it plays out.
Hey CM, Here's Our Laundry List Of Woes
NAREDCO (through its President R K Arora) has shot off a letter to UP Chief Minister Yogi Adityanath, requesting immediate redressal of long-pending issues.
Turns out, that even if your company goes bankrupt and leaves 25K homebuyers' families sucking their thumbs, you can still write cool letters to the government.
What? Yes. Arora is the Supertech Group Ltd Chairman (Supertech Ltd is facing insolvency proceedings along with Jaypee Infratech and others). The entity’s developers mainly have projects under the Noida, Greater Noida and Yamuna Expressway authorities.
What Are These Issues (as claimed by NAREDCO)?
📌 NCLT’s insolvency proceedings against developers, holding up project completions, deliveries, land due clearances and loan repayments.
📌 Implementation of Supreme Court order, directing UP authorities to link delayed land payment penalties to SBI MCLR rates from January, 2010.
📌 Exorbitant land dues and stalled approvals, OC, and permissions.
📌 Release of sub-lease/registry permissions in proportion to land payments made.
📌 Interest-free/zero period to compensate builders for project stoppages owing to Court/NGT orders.
The letter mentions land payment and other revenue losses of the authorities owing to insolvency proceedings.
Whose court is the ball in now? Time will tell.
---------------
Rajapaksa carried out populist tax cuts in late 2019, reducing revenues just months before the pandemic devastated the economy, with international flights grounded and successive lockdowns ordered.
Remittances from overseas Sri Lankan workers dried up as well as many lost their jobs, resulting in angry mobs demanding the Sri Lankan chief to step down.
Last heard, his brother (the Sri Lankan finance minister) became the fall guy and took the chief's place to cool down folks carrying Molotov cocktails.
Quick Lesson: Don't pray for tax cuts. Pray for a raise instead. 💚
☕ The Crew@Ginger Chai