Post-2016, after the demonetisation announcement, the real estate sector in India took an unprecedented turn. Affected by the slow pace of economic growth in India, the investment in property business also took a course of vigilance. To add to it, there was much news surrounding the implementation of RERA, the Benami (prohibition) act and the realty business in India coming under the purview of GST. Overall, the business of real estate got affected in context of anticipated growth led by transparency, change in prices, and subtle changes like more respect towards the buyer sentiment. While 2017 was prominently about hope, will this year be any different?
Considering the ground reality of certain facts, such as RERA, the high growth momentum may well seem to be a distant reality. There are glaring facts concerning the implementation and administration of the- transparency act. People, till date, have low awareness or a vague notion about RERA. However, their judgment is firm. They believe that RERA will bring in more transparency and buyer hold over property transactions, since there will now be a grievance cell, an opportunity to check the project development and so much more, through the state authority run RERA act website. Well, till now, it all seems good on the books because there are many administration glitches noted in (RERA implementation), by respective state authorities. Given the delay in administration, it still remains to be seen how much more on-ground awareness will be built this year, thus impacting the real estate investment positively. RERA, for one, is expected to bridge the trust deficit between the buyer and the seller, so it is an important change which remains to be seen.
However, there are some strong reasons to expect a positive development (recovery) in the real estate market. There is a huge inventory pile up in the premium market category, which needs to be cleared and will remain in focus in 2018. With limited supply, the valuations are expected to be corrected and given the competitive landscape, buyers can expect some favourable developer effort to make it happen.
There is also news coming from the affordable housing quarters. The government is focused to deliver on its big promise of affordable housing and with bank rebates and housing loan discounts for individuals who are willing to invest in the segment, it sure will build volume of sales. This definitely means more brisk sales. Overall, it’s a win-win situation for developers who have to do some real-time selling for their premium units, in turn, befitting the buyer’s interest, and for people, who are looking for affordable options.
Also, depending on the implementation and awareness build up about RERA, the sector will once again see more business happening, since the major issue of lack of trust, giving buyer, a supreme control will be addressed.
There are still some major threats to the current trend towards renting a house is picking up. It clearly shows that the buyers are in a wait and watch mode as they continue to expect the right price for the life-long investment they make. The mentality, of buying an own home, is not so prevalent among the X and Y generation. They don’t mind renting a home which is close to their office, thus making it easier for them to commute, for example. It further throws light on the implied fact that, people are not in a hurry to scout for a house. Rather, they need their own space, time and money, to be spent wisely and prudently. In all, they are ready to wait for the promises to be delivered and only a full conviction will drive them to make an investment.
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.