ICICI Home bullish on Kolkata realty

ICICI Home Finance expects Kolkata to contribute in a big way to the residential financing market in the next 3 years.

"Although the residential financing market space in India is about Rs 1 lakh crore and the market in Kolkata is around Rs 2,000 crore, it is expected to grow at a much faster rate compared to the other metros in the next 2-3 years," said Sunil Rohokale, the managing director and CEO of ICICI Home Finance.

A saturation in other markets will give a boost to the market in Kolkata. Mumbai leads the residential financing market with a share of 10 per cent, followed by Delhi and Bangalore with 9 and 7 per cent respectively.

"Slowly, but steadily, the other markets are getting saturated and the Kolkata market, being relatively cheaper, provides a better alternative," he added.

Rohokale also attributed Kolkata's rise to the state government's proactive role in promoting lower and middle income segments, where affordable housing is possible.

"The West Bengal government is looking for inclusive growth and by providing incentives, by encouraging public private partnerships not only in the higher-end segment like commercial buildings but also in the middle and lower segments as well, which consist of mostly small housing projects," he said while talking to Business Standard on the sidelines of an interactive session at Credai Bengal Real Estate Conclave.

It would be in the affordable housing segment, where most of the private investment is going to come, feels Rohokale.

In the last two years, the real estate market attracted an investment of around $7 billion, including $3 billion from equity. Of this, the share of Kolkata was around 3.5 per cent, amounting to $150 million.

"There is a huge demand in Kolkata for affordable housing flats, which range between Rs 15 lakh and Rs 25 lakh, but the developers are most active in the premium-range flats between Rs 25 lakh and Rs 50 lakh. Hence with the state government providing incentives, affordable housing space looks most attractive in Kolkata," Rohokale added.