Real es­tate sec­tor ex­pected to per­form bet­ter than ever

In­tro­duc­tion of GST and RERA is likely to re­store the buy­ers’ con­fi­dence in the mar­ket.

Alive - - News - by Ramesh Ku­mar Raja

Off late, the In­dian realty sec­tor has started to move to­wards be­com­ing more and more or­gan­ised as we see it get­ting stronger to­wards the front of re­forms. With the in­cep­tion of Real Es­tate Reg­u­la­tory Au­thor­ity (RERA) in the sec­tor and ma­jor­ity of states mak­ing it op­er­a­tional, the sen­ti­ments of in-

vestors and buy­ers have started to pick up pace.

With the in­put tax credit to be passed on by the de­vel­op­ers to the cus­tomers, the post-GST real es­tate sec­tor is ex­pected to bring about a fresh series of de­mand in the next few months. The gov­ern­ment’s plan for Af­ford­able Hous­ing, Smart Cities, AMRUT, Hous­ing for All and other in­fras­truc­tural ad­vance­ments drifts our fo­cus to­wards bet­ter reg­u­lated realty sec­tor.

In nutshell, the realty sec­tor in In­dia is look­ing at a much needed rev­o­lu­tion which was long awaited, and in near fu­ture, we will wit­ness a ma­jor re­vamp that is pro­jected to ben­e­fit the econ­omy in the long run.

In­dia’s north­ern part of real es­tate is ma­jorly con­trib­uted by the Na­tional Cap­i­tal Re­gion (NCR) which ac­counts to one of the big­gest realty mar­kets in the coun­try. Dis­tricts from Ut­tar Pradesh, Haryana and Rajasthan, along with the NCT of Delhi con­sti­tute to­wards the NCR re­gion.

NCR be­ing a prime contributor for In­dian realty, there is a huge chunk of pro­fes­sional de­vel­op­ers and builders in the re­gion working to­wards de­vel­op­ing res­i­den­tial and com­mer­cial projects. All the NCR states have made RERA ap­pli­ca­ble with only Haryana left to make the web­site op­er­a­tional.

With GST and RERA now in place, ac­tiv­ity on the buyer and in­vestor front has am­pli­fied. Pos­i­tive sen­ti­ments are float­ing as cus­tomers are look­ing to­wards real es­tate as an in­vest­ment av­enue with mar­ket now look­ing more trans­par­ent with the prom­ise of de­liv­ery.

As sen­ti­ments gain mo­men­tum, de­vel­op­ers are gear­ing up to launch more projects and de­liver the ones in pipe­line. This thrust is driv­ing the de­vel­op­ers to­wards quick com­ple­tion of projects and launch new ones.

“RERA and GST are aimed at sim­pli­fy­ing the real es­tate buy­ing, tax­ing and re­dres­sal pro­cesses which will di­rectly ben­e­fit its stake­hold­ers. These re­forms will act as long term cat­a­lysts as we see the de­vel­op­ers rais­ing funds to launch new projects and fin­ish those in fi­nal stages,” ex­plains Kushagr An­sal, direc­tor, An­sal Hous­ing.

Re­cently, real es­tate com­pany Sikka Group had raised Rs 230 crore from a lead­ing In­dian bank for three of its hous­ing projects, namely Sikka Kar­nam and Sikka Kaamna in Sec­tor 143 on Noida Ex­press­way, and Sikka Ki­maantra in Sec­tor 79 in Noida. The amount raised is to be utilised to­wards speed­ing up the con­struc­tion of these projects.

In a sim­i­lar man­ner, realty firm Gul­shan Homz has ini­ti­ated the in­vest­ment of Rs 400 crore to de­velop two of its projects, Gul­shan Bel­lina in Greater Noida West and Gul­shan Bot­nia in Sec­tor – 144 along the Noida Ex­press­way.

The com­pany had re­cently launched

Gul­shan Bot­nia and had ear­lier launched Gul­shan Bel­lina which will of­fer a to­tal of 1892 units. An­other Noida realty ma­jor, RG group had raised Rs 170 crore from a pri­vate equity firm for its hous­ing pro­ject in Noida, ‘RG Res­i­dency’ and clear its dues to the devel­op­ment au­thor­ity.

Very soon, NCR based de­vel­oper Para­mount Group is ex­pected to raise funds to­wards speed­ing up the com­ple­tion of one of its on­go­ing res­i­den­tial projects which is al­ready run­ning ahead of its sched­ule.

“Pro­ject launches had dipped last year, and due to the im­ple­men­ta­tion of RERA and GST, is quickly gain­ing pace again. As these re­forms set­tle in, mar­ket will re­spond soon and will ob­serve bet­ter stake­holder interest,” avers Vikas Bhasin, MD of Saya Group.

Newly launched projects

In a re­cent ex­am­ple of fund rais­ing for pro­ject launches, lead­ing fi­nan­cial in­vestor KKR had com­mit­ted to in­vest Rs 200 crore in NCR based af­ford­able hous­ing player Sig­na­ture Global.

The com­pany had also launched two af­ford­able hous­ing projects in Gu­ru­gram pri­mar­ily, ‘The Mil­lenia’ in Sec­tor – 37D and ‘Sol­era 2’ in Sec­tor 107. The projects would also be com­ing up un­der the Haryana Af­ford­able Hous­ing Pol­icy like their pre­vi­ous projects.

In Noida, realty firm Gaur­sons Group, which has been into de­velop-

ment of res­i­den­tial and com­mer­cial projects in Delhi/NCR, has planned to in­vest Rs 150 crore to de­velop two lux­u­ri­ous tow­ers called 'Gaurs Plat­inum Tow­ers' as the com­pany ex­pects bet­ter de­mand for lux­u­ri­ous dwellings with the de­crease in sup­ply in the seg­ment.

The com­pany’s re­cently launched twin tow­ers will have a to­tal num­ber of 52 res­i­dences with 26 units in each tower with state of the art fa­cil­i­ties and ameni­ties.

With the mar­ket gain­ing mo­men­tum and buy­ers get­ting in the mode of in­vest­ment, real es­tate sec­tor in In­dia is pro­jected to per­form bet­ter than ever with a reg­u­la­tor sit­ting in each state to mon­i­tor all the ac­tiv­i­ties. With the fes­tive sea­son of this year just around the cor­ner, buy­ers are also gear­ing up to in­vest in the era of In­dian real es­tate.

Re­serve Bank of In­dia’s re­cent de­ci­sion to cut repo rate by 25 ba­sis points af­ter a gap of al­most nine months, is an at­trac­tive propo­si­tion. The devel­op­ment is likely to put the res­i­den­tial real es­tate mar­ket back on the growth tra­jec­tory and give a boost to af­ford­able hous­ing.

Ic­ing on the cake

Ex­perts an­tic­i­pate the home loan interest rate to hover around 8 per cent once the banks de­cide to pass on the ben­e­fit to con­sumers.

Sa­man­tak Das, chief econ­o­mist and na­tional direc­tor, Re­search, Knight Frank In­dia, said, “With real es­tate prices re­main­ing stag­nant, interest rate show­ing a de­clin­ing trend, tamed in­fla­tion, RERA in place, the con­fi­dence of home buy­ers will be back in the mar­ket. This is an op­por­tune time as the fes­ti­val sea­son is just around the cor­ner. The move to cut rates is bound to in­crease sales trac­tion. There may not be a full-fledged re­vival of the real es­tate mar­ket but it cer­tainly her­alds an ini­ti­a­tion of a growth tra­jec­tory in the res­i­den­tial space.”

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.