Innovations in Home Building and Home Decor Industries in India
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ICMR HOME | Case Studies Collection
Case Details:
Case Code : BREP002
Case Length : 16 Pages
Period : 1991-2004
Pub Date : 2004
Teaching Note :Not Available
Organization : Parryware, Asian Paints ...
Industry : Home Building and Home Decor
Countries : India
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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The Home Building Boom
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Until the late 90s, homeowners in India, were typically persons over 40 years of age. The average age of people buying homes has come down in recent years from 40 years and above to around 30 years.
Data available with financial institutions show that people between the age of 25 and 30 years were taking home loans3. Low interest rates on home loans, the increased availability of real estate especially in the suburbs, multiple incomes, the transition from joint family system to nuclear families, and a change in mindset of people are some of the factors that have led to more and more people owning homes in recent years.
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Perhaps, the single greatest incentive to owning a home has been the low home loan interest rates (Refer to Exhibit I for a chart on home loan interest rates). In addition, the procedures for getting loans approved have become simpler and it takes much less time to process a loan than before. Owning homes became easier and people have even been buying second and third properties, or upgrading to bigger apartments.
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As mentioned earlier, the availability of real estate at competitive prices has also influenced many to buy a home. The development of real estate in the suburbs of major cities has taken off in a big way.
Huge apartment complexes have sprung up to fulfill the aspirations of salaried and self-employed individuals to own homes. Most of the higxh-class apartment complexes have 24-hour power and water backup, a security system, swimming pools, gyms and recreation centers.
Therefore, suburbs that used to be the destination of old people after retirement have become places where people in their 30s are living. |
According to an apartment owner in a suburb outside Chennai, "I am 37, and I am not the youngest here — younger people are making more money. We bought the idea of happy living, so even commuting isn't really a problem, because you know that at the end of it you are coming to this environment - it's quiet, green and cosmopolitan."4...
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