Over the last couple of years, the real estate sector has witnessed the implementation of several reforms such as REIT, Benami Act, CLSS, RERA and GST. These reforms began a phase of transition for the sector, which continued in 2018 and has helped the Indian realty market enter the consolidation phase. Additionally, it has created a positive perception amongst the investors, enabling a conducive environment for real estate investment and development in the country.
As a result, India has emerged as one of the key markets for global investments. Moreover, there has been a continuous thrust from the Government towards making the real estate sector a significant contributor towards overall economic growth. These are adequately resonated in the initiatives taken throughout the year.
Early in the year, the Government had approved the reduction of GST rate for affordable housing to 8%. This was followed by some positive announcements during the Union Budget. This included creation of a dedicated affordable housing fund in the National Housing Bank (NHB). Additionally, the Budget had proposed a tax relief for buyers and sellers of property by allowing it to be valued at up to 5% below circle rates for calculation of stamp duty and capital gains tax.
The year 2018 also witnessed some major infrastructure projects planned under Bharatmala and Sagarmala for roadways, highways, waterways and ports. The focus was also on increasing metro connectivity in all the major cities. Additionally, there is continuous expansion and development across all major cities, opening up opportunities in micro markets. These together will give a fillip to the real estate market in the country.
Further, the recent revision of the carpet area from up to 120 square metre to up to 160 square metre for MIG I and from up to 150 square to up to 200 square metre for MIG II under PMAY scheme will help the real estate sector perform better in the long term.
More importantly, the sector is becoming stable, transparent and accountable that is poised to achieve the vision of ‘housing for all’.
It is also an opportune period for consumers to buy homes with home loan interest rate as low as 8.65%.
Today, India is among the top 10 price appreciating housing markets globally, with housing sector alone contributing 5 to 6% to country’s GDP.
In the year 2019, the housing market is expected to improve. This is reflected in the market sentiments, with the demand picking up across all regions. Developers are increasingly becoming conscious of offering a host of choices to homebuyers without compromising on affordability, liveability and timelines. Affordable housing segment will continue to thrive, increasing the market size and plugging India’s urban housing shortage. This will amplify the housing demand in India and is likely to become a game changer for the sector.
The sector is hopeful that 2019 will be a good year for the realty market overall.
On that note, we wish everyone a happy and prosperous new year!
