The real estate sector has already been dealt a body-blow in the form of demonetization followed by RERA or the Real Estate Regulatory Authority Act. However, industry experts are forecasting a positive trend in the real estate market during the festive season. Real estate developers in Mumbai are hopeful of the market stabilizing this Diwali and are witnessing an increase in overall inquires for ready-to-move-in properties.
These projects will not require any GST to be paid by the developers and hence they are in higher demand in the festive season according to developers. They have also revealed that the highest sales volumes in the whole of last year took place during Diwali. They are hoping for a more stable trend this time, if not a repeat of last year’s bonanza. NAREDCO has analyzed the present market scenario and the Vice President, Rajan Bandelkar, stated that Diwali was hugely lucrative for Indian real estate last year in comparison to the current year. The maximum sales happened in Diwali although sales volumes are not that high this year. With GST, RERA and demonetization, Diwali is not really attractive for developers any more according to him.
However, he stated that more enquiries are coming in for ready-to-move-in apartments since they will have no GST as compared to flats which are being constructed. As a result, demand is high for these flats and they are sure to be sold out. Around 13,000 projects are already registered and it is hard to confirm as to how many inquiries have come in for the same according to Bandelkar. The founder and CMD at Hiranandani Group and national president, NAREDCO, Niranjan Hiranandani, stated that the impact of recent policy changes have affected the real estate sector but they will not last for a very long time. He talked of how the sector has been recovering from this slowdown.
The earlier developments led to a slowing of buyer decisions although realty purchases have gone up in recent times and with more transparency owing to GST and RERA, buyers are returning to the market according to him. Latest reports indicate that the real estate market is seeing high demand for affordable homes. Real estate developers are now eager to build affordable homes, taking into account government subsidies for buyer benefits and the increasing demand. Developers are also giving other offers including the 20:80 payment plan and others for attracting more buyers.
Hiranandani also stated that financial institutions and banks are providing home loans at the lowest possible interest rates in the current scenario and several factors like the affordable home interest subvention scheme are expected to boost home-buying sentiments this Diwali. These incentives should attract those still sitting on the fence for taking their purchase decisions. Residential real estate sales volumes are expected to go up this Diwali according to Hiranandani.
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