There will always be a demand for houses; but progressive policy changes can help developers sell more units, says Rohith Cariyappa, Director Sales & CRM, Assetz Property Group.
The demonetization drive of 2016 along with the introduction and implementation of RERA and GST in 2017 have disrupted the real estate industry of India. Not only has this hit the sales and the new launches of real estate, it has also halted the growth of the industry although temporarily.
“The implementation of GST has reduced the overall cost of residential projects across the country. Capital markets are in a state of stability. Yet the demand has not been able to match up to the supply across areas,” said Rohith Cariyappa, Director Sales & CRM, Assetz Property Group, while discussing Bangalore real estate with Magicbricks correspondent Jayashree Kurup.
That said, both policy measures and legislative changes have brought in massive amounts of transparency and professionalism in the system, making the developers responsible and accountable for completing their projects on time, and instilling confidence in the minds of the consumers.
In its effort to achieve its objective, Housing for All by 2022, the Government of India has announced various tax incentives to attract prominent developers to develop affordable housing projects under the Pradhan Mantri Awas Yojana. The announcement of CLSS (Credit link subsidy scheme) along with the interest subsidy of 4% has made it easier for buyers and developers to get loans at affordable rates. With the introduction of more and more incentive programs, 2018 is going to see a positive trend in real estate.
Apart from successful implementation of RERA and GST, 2018 is going to see a further reduction in interest rates, an increase in loan portfolios, interest subsidies for first-time home buyers, and more FDIs for the real estate and construction sectors. With affordable housing becoming a priority, developers are going to specialize in plotted developments, commercial spaces, townships, and other residential projects. This is going to give the buyers a lot of options to choose from and purchase.
“GST can motivate people to buy homes by reducing registration costs and standardizing them across all cities. There has always been a demand for houses, but good policy changes can help developers sell more units. Reduction of interest rates on home loans will help more people to buy houses. Changes in income tax slab structure can help people save more money to invest in homes. At the end of the day, the government has to realize that the real estate industry is not only one of the biggest industries in India; it is also one that offers employment to a huge of number of people. The GDP of the country is dependent on this sector,” expressed Rohith Cariyappa in discussion with Magicbrick’s Jayashree Kurup.
Home loan rates are at an all-time low and are expected to remain so in the future. Banks are going to be more supportive and encouraging about helping buyers invest in real estate. A few more policy changes on the part of the Government can drive sales and help the market achieve the position it used to enjoy previously.
Placing a single window clearance for building permissions can help developers get their projects approved without any hassles. At the same time it can also help the end-consumers obtain the certificates necessary to start living in the homes that they buy. While this and many more reforms are in the plans of the Government, it might take a while before things start falling into place. Unfortunately the clock has already started ticking. The Government will have to take some crucial measures to pace up things and deliver faster before people start giving up on their patience. It is high time the steps taken by the Government start having their effects on the growth of the industry.
Source: Magicbricks Bureau