Mumbai: With the recent blow to the real estate sector post demonetisation and roll of Real Estate Regulatory Authority Act, experts have predicted that the upcoming festive season will bring back the charm to the real estate market. In what seems to be a ray of hope for financially-hit developers to get back on their feet, there has been a sudden increase in inquiries for their ready to move in projects.
Developers are hoping that the auspicious festive season of Diwali may stabalise the market. The ready to move in projects where the buyer will not have to pay Goods and Services Tax are in demand for this Diwali. Developers confessed that last year’s Diwali witnessed the maximum number of sales in the entire year.
The National Real Estate Development Council (NAREDCO) after studying the current scenario of the real estate market are looking forward to Diwali. Rajan Bandelkar, Vice President of NAREDCO, said, “Last year, Diwali was very prosperous for the real estate sector compared to this year. They had made their maximum sales by Diwali and it was the best month of that year for real estate. This year, however, the sales aren’t that high. With the emergence of demonetization, RERA & GST in the span of this one year, this Diwali isn’t turning out to be a good one for the developers. However, enquiries have come in for ready flats since they hold no GST on them compared to under construction flats. So, there is tremendous demand for ready flats and it is sold out positively. So, compared to last year, the increase in inquiries aren’t much just before Diwali. Since, 13,000 projects are now registered it is difficult to say how many approximate inquiries have come in.”
Speaking exclusively to the Free Press Journal, Niranjan Hiranandani, founder and CMD of Hiranandani Group and national president of NAREDCO, said that the impact of the recent events continue to be there in the real estate sector but may not last for long. He said, “The Indian economy as also the real estate industry are working their way out from the slowdown that resulted from what I term as the tsunamis namely demonetisation, RERA and GST. These tsunamis effectively, slowed down the buy decision, almost all home seekers have been in a wait and watch mode since past few months. Over a period of time, real estate transactions have started increasing in numbers and as a result of implementation of RERA and GST, transparency has gone up and the buyer has returned. This definitely suggests the impact of the tsunamis seems to be wearing off.”
Recent survey report of the real estate market indicates an increase in the demand for affordable housing. Developers are now more interested in constructing affordable homes considering the demand and government subsidies that will benefit the buyer. Besides, developers are giving lucrative offers for buyers, apart from the standard 20:80 payment scheme, to invest in their project.
Hiranandani added, “Banks and financial institutions are offering home loans at historical low interest rates, and various positives, including interest subventions scheme for affordable home buying will boost sentiment this festive season. This should impact indecisive fence sitters and we should see them make the buy decision, provided that the market sentiments are conducive for home buying in the festival season that is upon us already. I expect residential real estate sales to improve in this festive season, I expect fence sitters to step forward and make their home buying decision.”
