by Pooja Bhatia
2017 saw rising expectation of property buyers with the biggest regulatory reform- RERA- being implemented. Even though there were reported delays in administration and thus, the implementation of RERA, the sector growth showed overall optimism. As the buyer sentiment continued to be positively influenced by the ground level changes in 2016-17, there will obviously be a spill-over in 2018 and so on. So, what should we be really expecting this year as far as property selling/buying is concerned?
Here we list the top five expectations from the realty sector in 2018:
- Market expectations and investor returns– we often heard it up to 2018, yes, we are talking about the news on improving buyer sentiment to invest and thus, clear the inventory pile-up of builders. So, will 2018 really deliver on it? With the job growth likely to happen, and with a slew of corrective measures in the real estate industry, it is likely that the inventory-on-hold will finally clear up. There was one more reason for final inventory build-up. It was builders launching new units to save themselves from RERA purview. Let us see how many such units are sold and how their pricing will be influenced this year. Affordable housing is one prominent spectrum where investors can continue launching new housing units in confidence and expect the bulk of revenue (cash flow) to come up.
- FDI– it has been long awaited to boost up the residential housing unit build-up, bring in more wealth to revive the declining fortune of the existing builders and also, influence the change in the real estate sector landscape of India. There are many more reasons to believe that the FDI action will finally happen, given the structural reforms and support for transparency in housing transactions from all quarters of the industry.
- ROI– from a buyer perspective, every reform measure will boost their confidence in the investment. Plus, the infrastructural growth and changes, which is expected to boost the buyer investment in new locations and colonies across India.From a seller perspective, the complete change of the investor sentiment is likely to boost the sales and with correction in pricing and affordable housing in the reality bracket, it is only expected to give them an effective return on investment in the long-term too. Add to it the GST benefit they are getting in the construction of housing. It is likely they continue making huge profits.
#CBRE2018Outlook | ‘As we move into 2018, India’s #RealEstate sector will continue to see robust activity. Despite disruptions and growing prominence of new formats, the country’s office segment will witness stable demand’, @AnshumanMagzine (via @timesofindia) pic.twitter.com/aqgUkbwums
— CBRE India (@CBRE_India) December 29, 2017
4. Property Value– it is likely to go up in real terms and real value. The investor interest is going to be driven by the buyer demand, and the buyer sentiment, in return, will be driven by transparency, appreciation and infrastructural changes. Overall, it does seem to be a situation of appreciation in property value eventually.
5. Market Value– in the recent past, the sector growth has been downtrodden by the delay in property buying, postponement of property purchases, the reduced launch of new residential units, thus, the overall market sentiment has been somewhat dampened. This year, most likely, there will be a rise in the market value based on factors of transparency, expected infrastructural growth, strengthening of the bond between the seller and the buyer community, distinction between affordable and premium units and overall, more investment activity in the real estate market.
Having said that, it is important to note that all these points are touted expectation for real estate sector in 2018. And that, any such deliverance will be subject to the overall market sentiment including the investor and the buyer and the administration part of it. Till then, we stay in a wait and watch mode.
Pooja Bhatia is a property news enthusiast, who likes staying updated on business and corporate news, lifestyle at home, home interior elements, location insights and rest of the information, to make living better. She is also an avid traveler (a blogger on holidays) and an avid reader and a part of this real-time information, she converts into real estate enthusiasm.