Second Homes Or Vacation Homes

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Emerging yet nascent segment of second home in India.

Text of Second Homes Or Vacation Homes

  • 1. SAPPHIREZ ASSET SOLUTIONS Market for Second Homes

2. Live your Dreams 3.

    • Segmentation of Vacation Home market internationally

Understanding Vacation HomeVacationOwnership Property owned generally for personal useTimeshare A timeshare is a form of vacation property ownership.The use and costs of running the resort are shared among the owners VacationRentals Renting out a furnished apartment or house on a temporary basis totourists as an alternative to a hotel VacationExchange You trade your interval or week for new and different vacation experiencesat comparable resorts across the country and around the world 4. International Demand Drivers

  • Economy
  • Population
  • Propensity to spend
  • Income Levels
  • Rate of borrowing
  • Growth rate
  • Attracting investment
  • Government Initiatives
  • Conferences

Baby Boomers Interest Rates

    • Key movers of the Vacation Home market

Tourism 5. Vacation Homes-InternationallySource: National Association Of Realtors 2006 Tennis Golf

  • Key Learning's:
  • Internationally activities are critical aspects of Vacation Homes
  • Brokers / real estate agents play a critical role as channel partners
  • Locational advantage needs to be broadcast forindividual property

6. Vacation Home Buyers: International Distances between residence & Vacation Home Usually less than 100 miles Size of home : 1000-1500 sqf Average value per sq.ft Source: Economic Realtors Research 7. US Vacation Home Market

  • International Vacation Home market is maturing and seeing considerable growth
  • The US$ 13 billion Vacation Home industry in US is 0.10% of GDP as of 2005
  • Multiple players having unlimited product offerings
  • GDP of US playing an integral role for burst of Vacation Home industry

Vacation Home market is growing @ 9.7% worldwide & @ 14% in U.S Along with high growth rates comes heightened competitionBrands would soon start at exploiting other geographies0.05 % 0.08 % 0.10 % 8.

  • Given the current economic trends we can draw the following hypothesis:
  • - The Size of the Vacation Home industry is approximately US$ 0.757 billion or INR 34,150 Crore
  • Experts predict the GDP growth rate to be close to 8%, the same would see a rise in income levels A factor which is one of the key growth drivers

India Vacation Home

  • Generation X will boost the growth of Vacation Homes in India
  • India the next growth driver for international companies

0.05 % 0.08 % 0.10 % 9. Indian Luxury Consumer: HNI Disposable income 9 lac p.a Owns D/E segment car Residing in posh localities Average age = 36-40CWE= Mostly MaleMarried and has kids42% live in joint families 35% of wives working 44% traveling abroad for vacation,at least once a year 10. Affluent Map Of India

  • Predominantly luxury consumers reside in the north and west

Source: Technopark 11. Vacation Home : Snapshot

  • Vacation Home
    • 100-200 kms from metros around a natural attraction primarily hill stations, beaches
    • International Vacation Homes in Dubai, London etc.
  • Customers
    • HNIs & NRIs
  • Initial Value Proposition
    • Variety & convenience of one stop shop
  • Sustainable Value Proposition
    • Needs based development
    • Reach & access to NRIs
    • Destination development and marketing

12. Indian HNI : Primary Target

  • Products
  • Vacation Home
  • Purchase/Lease of Commercial
  • Investment in Real Estate Funds/ REITs
  • Competitive Landscape
  • Wealth Managers proffering Equity & Debt instruments
  • Dedicated sales team representing high value assets
  • Advertising & PR by builders & marketers
  • Needs
  • Prestige, Ego Value
  • High Service Quality
  • Large portfolio of options
  • Customized Advisory
  • Relationship Building
  • Credibility & Accountability
  • Opportunities
  • Convenience of one stop shop for real estate needs
  • Advice rather than push
  • Broaden the horizon to look at new emerging opportunities like equity involvement
  • Wealth Management perspective

13. NRI : Secondary Target

  • Products
  • Vacation Home
  • Equityinvestment inCommercial , Hotel Real Estate Development
  • Competitive Landscape
  • Wealth Managers proffering Equity & Debt instruments
  • Dedicated sales team representing high value assets
  • Needs
  • High Service Quality
  • Large portfolio of options
  • Customized Advisory
  • Relationship Building
  • Credibility & Accountability
  • Opportunities
  • Convenience of one stop shop for real estate needs
  • Advice rather than push
  • Broaden the horizon to look at new emerging opportunities like equity involvement
  • Reach to micro-segments

14. Key Success Factors

  • Direct Selling & Marketingfor HNIs, NRIs
    • Dedicated sales and service team forHNIs / NRIs
    • Dedicated processes and systems to manage service & sales issues
    • Dedicated telemarketing & call centre support
  • Direct marketing strategy comprising of internet marketing and other channels
  • Pioneering new and excitinginitiatives
    • Example : Halfshare.com specializes in the shared ownership of luxury vacation properties throughout North America.
      • They help buyers find their ideal vacation property or Vacation Home while matching them with the right co-owner through a Buyer Match Plan

15. Key Success Factors

  • Continuous inventory acquisition by a dedicated team
    • Dedicated team to scout for projects under development, completed projects, re-sale inventory
    • Acquisition could be followed by
      • Re-packaging the real estate to make it more appealing to the target buyer
  • Sound Real Estate Knowledge Base
    • Ability to track trends and assess impact for HNIs
    • Ability to give a wealth management perspective and offer
  • Good Service Quality
    • Training & People development to offer good service experience
    • Personalized service to HNIs/NRIs
    • Robust processes for transaction management
    • Strong performance management system

16. Live your Dreams 17. Call Sapphirez: Rajjeet Chandra

  • Mobile :+91 9867974602
  • Email: rajjeet@sapphirez.co.in