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Amid the property rentals rising in major cities post-COVID-19 pandemic and people fed up with issues related to rentals, brokerage, moving logistics, documentation and others, property listing platform NoBroker's Co-Founder and CBO Saurabh Garg opens up for an exclusive interaction with LiveMint

Excerpts:

 

With big industry players already in the market, how difficult was it for NoBroker to break the shackles?

Saurabh Garg: Of course, it was not easy. Before we started our firm, all of the founders have gone through the pain of finding a home via a broker which was a very broken process. My first experience happened in 2007 in Mumbai when I was looking for a house in Bandra.

NoBroker came as we realised that millions of people like us go through similar experiences every day. It was a genuine customer problem as other players – who have raised hundreds of millions of dollars – were working with brokers. There was not a single player that was solving the customer's problem. The pain point was that there was information asymmetry and high transaction costs. We started with a very genuine insight that the customer is pained, and doesn't want to pay brokerage.

The journey was not easy because we were building a two-sided marketplace, but because it was a genuine customer problem and all of us spent a lot of time speaking to customers, even now.

NoBroker has over 75 lakh properties registered on the portal. How big is your team and what's the recipe behind maintaining such clients?

Saurabh Garg: We have been operating for the last 8 years. Many people tried to expand to 50 cities. But, real estate is a hyper-local thing. If you want a place in Navi Mumbai, then you will look for a place in Kharghar, you won't even go to Vashi. So, the demand and supply are needed at a very local level.

ALSO READ: NoBroker becomes India's first proptech unicorn after $210 mn funding round

Through NoBroker, we always ensured that we go deeper into the cities where we are and that's why more and more sellers and owners came and listed their properties. The owners also didn't want to pay brokerage so they came on board. On our platform, we ensure only genuine owner and buyer transactions without the interference of an agent.

Your firm became the first proptech unicorn in November 2021. And now the startup also has secondary businesses. What's next?

Saurabh Garg: We are a one-stop shop for anything in real estate. So, in the journey, when we come across something broken, we will try and solve it. These insights kept coming as we keep speaking to our customers who addresses the pain points. We are simply solving the issue and bringing it under one umbrella for an easy, hassle-free experience. 

Our idea is 'anything you need to do on real estate in India, you should be able to do it on NoBroker'. We will keep listening to the customers and keep evolving whatever the customer requires.

With the entry of NoBroker in the market, many people lost their jobs. Reports suggest your office was attacked. How was the initial period and how is it now?

Saurabh Garg: We believe whoever is doing a good job will co-exist. Whoever does the job faster and more efficiently, customers will go to them. 

In 2015, brokers attacked our office which was a very horrifying experience for us. We had to vacate the office and work from a makeshift office for almost 2-3 months. But, slowly brokers also realised that there will be opportunities for them too. Now, I think we co-exist. There are no threatening calls and attacks in the last 7 years and now things are better.

Real estate is a risky business, considered to be for powerful and cunning people. How's the tech, esp. AI helping the firm? Plus what are the prospects for upcoming AI-based prop-tech firms?

Saurabh Garg: I don't think only the powerful and cunning people get into the real estate business. Over some time, the industry has become well-organised.

Artificial Intelligence plays a very critical role. I think that this is what an AI should be doing – understanding your requirement and then suggesting what are the best properties for you. Our AI guides owners and customers in getting solved issues related to rent, locality and other aspects based on their needs.

ALSO READ: Bengaluru emerges as preferred choice among real estate investors in APAC region: Report

Following the ease of COVID-19 restrictions, firms have started calling their staff to offices in major cities. How do you see this trend working, as most of the firms are still okay with WFH, while several employees seek to stay in their native places?

Saurabh Garg: I think it will depend on the kind of work which people are doing. There is some work which probably you need to do it individually – you don't need to come to the office, or just for one or two days a week. While there will be some firms who will say this work requires a lot of collaboration between the teams.

From March, we are seeing a lot of people coming back to the cities. We saw a lot of demand in terms of rentals and people coming and looking for properties for the last six months.

Major cities like Mumbai, Chennai, Bengaluru and Hyderabad have issues related to waterlogging. Rather than helping the people, the rentals are becoming costlier every single month. What is NoBroker doing in it? Why are proptechs not helping in decreasing property rates?

Saurabh Garg: I think you should think of us as a platform, as an exchange. If you ask NSE to reduce the price of stocks, how can it help? What we can do is we can provide you with options based on your budget and other requirements. Our platform is helping people by reducing this information asymmetry and providing information at your fingertips.

If you look at rentals, it has not increased homogenously in every part of the city. There are some parts where the rentals have not increased that much, while there are others where it surged a lot. People can take a conscious decision if the information is available. If they have to do it physically, it's very difficult.

Recently, several reports claimed there is a hike in property rentals, and in eight major cities, the rates have surged dramatically. Don't you think it's high time that house rentals become pocket friendly?

Saurabh Garg: One needs to first understand why the rents are rising. It is simply a demand and supply side of the business. All the people working in metro cities had gone to their hometowns and worked from there. Suddenly, they started coming back from March onwards to September. A lot of demand came in. 

Also, during the last two years, construction took a hit as workers went back during the pandemic and the environment was not conducive for them to work. So the construction was halted and it created an imbalance. The demand was high and the supply was less.

Another important thing is that people felt that they need bigger houses, to live within societies, so that too came in a big way. You will find that the rentals have increased in places which are closer to workplaces like tech parks or gated communities. But this is a demand-supply issue. I think over some time, this will normalise. I don't know if the rents will decrease, but they will stop increasing gradually.

How has the Real Estate sector performed in 2022 according to you despite inflation, hiked repo rate, increased CPI, and WPI?

Saurabh Garg: Rentals pre-March was not that good, but post-March till November the real estate sector performed well. We have seen houses getting rented in a few hours on the platform after it gets listed. Owners are also happy who made rental losses in the past 2 years.

If you look at the buy-sell, this pandemic played a very big role. Interest rates became very low 1-2 years back. Secondly, people realised – during the pandemic – the importance of owning a house. Thirdly, during the pandemic, people saved the down payment required to buy a house. The EMI to income ratio suddenly became the lowest in the past 10 years and this resulted in a lot of new buyers.

I think it is one of the best years, as for 8-9 years the real estate didn't do well due to several disruptions like GST implementation, RERA, demonetisation, etc. But in 2022, the real estate sector performed very well and we are seeing a upcycle in the sector.

Nykaa and Paytm already did it. When can we expect NoBroker's IPO?

Saurabh Garg: We don't have a timeline, we are moving towards that. We expect that in the next three to five years, we will look into an IPO.

ALSO READ: NoBroker to double technology and product team in two months

What is the real estate industry betting on in 2023 and what are its expectations from Budget 2023?

Saurabh Garg: Apart from residential properties, commercial properties have also started doing extremely well after the market opened up. Looking at the last 8-9 years, real estate investment was not happening as people were buying it for their consumption. I think what is going to change now is that more and more people will come into real estate as an investment option.

Speaking about the Budget, every year we tell that there should be more tax exemptions or investment in the real estate sector. Secondly, can the GST be brought within the registration cost itself as it is separate currently?

 

 

ABOUT THE AUTHOR

Saurav Mukherjee

A business media enthusiast...believe to listen more, than just blabbering like others.
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