A buyer’s guide to the realty sector in 2014 The Indian realty sector has grown tremendously over the past decade and has fetched high returns. But the sector has seen a slowdown in the last 8-10 quarters. High property prices and lower yields have pulled investors away from the market. As per the 12th five year plan by the Planning Commission of India, the targeted GDP growth is 8%. With the achieved GDP of 5% and 6.5% over last two years being low, the target in the coming years would be to boost growth by introducing reforms to improve growth of the economy. The areas under spotlight would be rural transformation and sustained growth of agriculture, manufacturing, accelerated development of transport infrastructure, securing the energy future of India, managing urbanization and getting more and more FDI. With rapidly evolving capital markets landscape, globally 2013 is seen as the year of realization and adaptation. The continuous fall of the Indian economy throughout the year made both investors and buyers cautious. This resulted in drastic decrease in the number of sales. Even in terms of funding, banks and other financing institutions followed a cautious approach. On one hand in 2013 owing to slow sales, developers were giving discounts and freebies to liquidate their piled inventories and on the other hand increased cost of borrowing, inflation, and project delays kept buyers (especially end-users) away from the market. The trend was more prevalent in MMR (Mumbai Metropolitan Region) and NCR (National Capital Region) markets. Developers are already offering discounts in the range of 10 – 20% across all segments. The Land Acquisition Bill and the Real Estate Regulatory Bill were positive changes that came about in 2013. The real estate fundamentals will hold strong in 2014, with improving optimism of buyers towards the state of real estate and infrastructure development in the country. Once these bills become laws, they will bring much needed transparency in the realty sector and both buyers and builders will get clarity. Post the 2014 general elections there is a high probability that the central government would change. After the elections one can expect clarity in the market. In recent times the Indian public, especially the youth, have communicated a clear message to all political parties that they want development and populist measures would not work anymore.
Posted on: Sat, 14 Jun 2014 09:44:40 +0000
Trending Topics
Recently Viewed Topics
© 2015