Goa Real Estate - Struggling

When you think of Goa, you think of the perfect holiday. It is this sentiment of Goa being the perfect tourist getaway that has caught the fancy of real estate developers far and wide.

According to estimates, around 75 per cent of Goa Properties are bought by people living outside the state. Most of the buyers are from the north of India- Delhi, UP and Bihar, since the north is deprived of a coastline. Several non-resident Indians also view Goa as a perfect place to retire as it offers a better quality of life than most states.

A large number of prime developers like DLF and Parsvnath Builders have taken up large investment projects in the state to cater to such buyers. Most of the Goa real estate builders offer residential segments in the form of beach-front luxury apartments, Portuguese style villas and sea-facing bungalows.

The demand for property in Goa is high not only because of its obvious appeal but also because stamp duty and property taxes in Goa are lower than in other states. Commercial expansion within the state in the form of high-end malls and multiplexes and the state's plans to develop SEZs, IT parks and install high quality broadband connectivity is adding to the profitability of investment projects.

There are however some threats for real estate development in the state. Recently, concerns have been raised about environment protection amidst the massive development that is taking place. Several Goans also feel that the essence and identity of the state is being taken over by the ongoing commercialisation and inflow of outsiders into the state. Because of Goa's small size, land disputes are also aplenty as most of the land is being acquired from local communities.

The ongoing global financial crisis and the debacle of the Wall Street will surely dampen the tourist scene in Goa during the otherwise peak months of October-December, feel industry experts. Though this is expected to only harm the hotel industry as of now, in the long run if the crisis continues, Goa real estate may also be affected. Investment projects in the state are also likely to slow down due to the liquidity crunch and the drying up of funds in the form of foreign investment.

The recent rape and murder of British tourist Scarlett Keeling in Goa has also stirred up a storm as many people have turned skeptical about the drug and crime scene in the state. It is hampering the real estate prospects of the state and further its overall image. By george Gonigal