Seco

nd

Ho

mes

Market for Second Homes

Segmentation of Vacation Home market internationally

Vacation Ownership

Property owned generally for personal use

Timeshare A timeshare is a form of vacation property ownership. The use and costs of running the resort are shared among the owners

Vacation Rentals

Renting out a furnished apartment or house on a temporary basis to tourists as an alternative to a hotel

Vacation Exchange

You trade your interval or week for new and different vacation experiences at comparable resorts across the country and around the world

Understanding – Vacation Home

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

Vacation Homes-Internationally

Source: National Association Of Realtors 2006

Desirable Attributes In A Vacation Home

38%

22%

22%

18%

Close To Ocean/Lake/River Sporting Activities

Close To Resort Ares Mountains/Natural Destinations

Leisure Activities Preferred

29%

20%16%

11%

10%

9%5%

Water Sports Boating Hunting/Fishing Golf Biking/Hiking Skiing Tennis

TennisMode Of Purchase For A Vacation Home

68%

18%

14%

Real Estate Owners Builders

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 for individual property

Vacation Home Buyers: International

Distance (Miles) Vacation Home % Investment Property %

25 44 69

25-99 19 9

100-199 22 5

200-499 1 *

500-999 3 3

1000-1499 * 6

1500 and more 10 8

Median Distance 49 18

* Less than 1 %

Home Size (Sq.ft) Vacation Home % Investment Property %

500 4 1

501-1000 14 14

1001-1500 56 22

1501-2000 11 31

2001-2500 9 12

2501-3000 5 10

3000 and more 1 10

Median Size 1290 1700

Format California Coastal South Florida Golf Destinations Ski Destinations

Studio 600 600 700 NA

1 BDR 590 600 550 550

2 BDR 480 600 450 580

3 BDR NA NA 400 600

Premiums ($ 000) 50-150 50-300 50-150 50-100

Distances between residence & Vacation HomeUsually less than 100 miles

Size of home : 1000-1500 sqf

Average value per sq.ft

Source: Economic Realtors Research

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 0

2000

4000

6000

8000

10000

12000

14000

1990 2000 2005

0

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14

GDP (In Billion USD) Vacation home Industry (In Billion USD)

Vacation Home market is growing @ 9.7% worldwide & @ 14% in U.SAlong with high growth rates comes heightened competition Brands would soon start at exploiting other geographies

0.05 %

0.08 %

0.10 %

• 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

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

0

100

200

300

400

500

600

700

800

900

1990 2000 2005

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

GDP (In Billion USD) Vacation home Industry (In Billion USD)

0.05 %

0.08 %

0.10 %

India Vacation Home

Disposable income 9 lac p.a

Owns D/E segment car

Residing in posh localities

Average age = 36-40

CWE= Mostly Male

Married and has kids

42% live in joint families

35% of wives working

44% traveling abroad for vacation, at least once a year

Indian Luxury Consumer: HNI

Affluent Map Of India

Predominantly luxury consumers reside in the north and west

Source: Technopark

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

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

NRI : Secondary Target

Products • Vacation Home• Equity investment in Commercial , 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

Key Success Factors• Direct Selling & Marketing for HNIs, NRIs

– Dedicated sales and service team for HNIs / 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 exciting initiatives– 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

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

Contact Us• Sarvajeet Chandra +91 9920803060,sarvajeet@theadiva.com,

sarvajeetchandra@gmail.com

• Visit Us at www.mastersungroup.com