Departure of Speculators Benefiting Leading Real Estate Markets

When residential realty markets are witnessing comeback of end users in some micro markets, the markets are benefitting as the speculators are being banished in top 7 cities despite the failure of sales. In leading markets like Bangalore, Delhi NCR, Mumbai, Chennai, Hyderabad and Pune, cumulative sales have eased to 2.02 Lakh housing units over 3 Lakh apartments up to 3 years ago. Despite the fact that new launches have been declined than the previous month, there is hike in absorption. The absorption of homes in best 7 Indian cities has been doubled to 500 units in January this year as compared to 250 units in December last year.

The crazy days of residential sales seems to be the past. These days, buyers make informed decisions instead of just going with everyone. Policy and structural changes like RERA, demonetization, and GST brought sanity in the real estate market in India. Investors who were worried of increasing prices in last year are no longer instrumental at all.

According to the experts, the drop was important to bring market to optimum levels and it is seeing more active participation of end users about the confidence ensured by the RERA Act, 2016. Within just a few quarters, a full-scale recovery will be possible. But the availability of fully-furnished apartments which don’t fall under GST and free from any risk of execution are the main attraction of buyers who want to buy house for personal use.

Because of several programs to provide affordable housing by the government, the absorption of Rs. 40 lakh price range is increasing significantly. In the overall absorption, the share of mid-range apartments jumped to 45% in the previous quarter 2017 while there was 39% in first quarter in 2017. End users’ demand is intact in affordable housing and is catching velocity in the backdrop of various government incentives behind the “Housing for All by 2022” campaign. Under Pradhan Mantri Awas yojana (PMAY) has cut down the interest rates at its low level and it is proved to be a great benefit. The segment will also get all the support needed in the Union Budget.