How the sector will look like in 2027?
Before giving this answer we need to consider few more facts that had taken place over the last 30 years of growth in the Real Estate sector of Bangladesh.
What did we know?
The market size of the real estate industry is around 6000 crores taka.
For the last five years, the growth was sharp 39% in the medium-sized apartments in between 1200sft to 1400sft.
The location-based community living concept is changing.
Definition of the posh area or upper-class area has shifted in new areas.
Though the housing concept is not new for civilization, in Bangladesh it was introduced in early 1984 and we experienced steep growth in the sector from early 2004. Since then, the concept of living in someone’s land which is developed by a professional company was accepted. Except for some underdeveloped areas of the rapidly urbanized Dhaka have been flourished with high-raised buildings, commercial iconic architectures, and expanding developing areas.
In the mid of 2008 total real estate company count was around 400 and right now only 100+ companies are operational. Companies like Bay, Shanta, and Concord focus on specialization in commercial and large residential projects in the heart of the town, while BTI, Navana, SEL, and Eastern focus on large-scale residential developments all around Dhaka city. The business model of each company differs from the others. There are also area-based companies that mainly work in a particular area like Uttara, Bashundhara, Mirpur, Mohammadpur, and Aftabnagar. These companies consider the cost-cutting method through minimizing mobilization cost and for selling the products they heavily depend on the area-based clients.
There are more than 1.4 million real estate professionals working in the industry directly and indirectly, and among them, 0.4% are architects, 17.9% are construction engineers, 77% labors, 0.2% are sales professionals, and 12% are engaged with other jobs. Over the last 10 years, the development in architectural design has taken Dhaka city to an astonishing level and as a result, a demand was created in early 2004 for architects, and a good number of people choose architectural engineering as their career path. It was a good sign for development in the liberal arts sector indeed, but many of these architects migrated to other countries due to lack of jobs and decrease in demand in 2013 and onwards. Many architect firms shut down their activities and the rest couldn’t catch up with the trendy design concept as their adaptation with the modern design faced challenges. Real estate sales are not an easy catch like FMCG or other industries. In the United States, an average real estate agent makes 2-3 deals in a year, a moderate agent makes 200K in a year as his commission, and a good one makes up to 5-10 deals with 1 million marks in commission. But in Bangladesh, the expectation of a company from its salespeople is very high considering the world’s real estate industry and these professionals end up with frustration and resulting in quitting their profession and switch to another industry. Another trait is, the professional either start his own developer company or is engaged in selling secondary property to his client base and becomes an entrepreneur. So in both cases, the gap is getting wider day by day. [to be continued……]
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