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Trends to Rule the Indian Real Estate Market In 2020

EMAAR-INDIA
2019-12-23

The past decade has seen the real estate sector experiencing a roller coaster ride; demonetization, RERA & REITs in 2016 as well as GST in 2017 have meant that the past few years have been especially tough on the realty sector.

But those were transformative phases and the picture is changing for businesses gradually since last year. The 2019 union budget proposed benefits for real estate with an eye to drive growth in the sector. The government is actively pushing the real estate segment as this sector is one of the key drivers that will propel their goal of achieving the $ 5 trillion Indian economy. On the strength of these boosts the real estate sector has once again picked up momentum and is growing at a healthy 9% and is expected to reach $180 billion by the year 2020. [1]

Investing in real estate is considered safer and more favorable in terms of returns than gold, mutual funds/stocks or other financial investments. But as a home buyer who will put in a considerable amount of funds there needs to be thorough research and study of the market prior to the investment.

Here are some trends that are expected to rule the Indian real estate market in 2020. Read on…

  • 1.Government initiatives-With an eye to revive and provide impetus to the realty sector, Finance Minister Nirmala Sitharaman outlined a slew of measures for the real estate sector in the union budget 2019 such as new model tenancy law, provision for construction of new public infrastructure on land holdings by the Central Ministries and Central Public Sector Enterprises across the country, reviving the NBFCs from the ongoing debt crisis and liquidity crunch, modifying TDS on immovable property to include other charges etc.[3]Also, collaboration between builders and the government will not only minimize risks but will also be a more viable economic model of development for urban real estate and infrastructure. These urban housing developments are aimed at the mid-segment home buyers and will look to provide budget friendly projects but with all necessary facilities for comfortable living.

 

  • 2.FDIs-As mentioned above the real estate sector is essential to the economic growth of India but it is also one of the most fluctuating in terms of funding. Attracting foreign direct investment (FDI) into the sector is vital to its continued growth and development. The Indian economy is looked upon as one of the fastest growing global economies and as such can yield good returns for foreign investors. The Government rules and regulations related to FDIs in the real estate sector have been favorable for global financiers and have successfully yielded a good amount for the sector which is expected to grow in the coming years.

 

  • 3.Escalating demand in top metros and Tier 1 & 2 cities –Another trend that is emerging is the rising demand for quality housing in not just metros such as Mumbai, Bangalore, Delhi-Gurgaon and Chennai but also in Tier 1 and 2 cities such as Pune, Hyderabad, Chandigarh, Ahmedabad, etc. The main reason is the employment opportunities through IT companies and other sectors as well. These cities have become hubs for real estate investment as the ROI is attractive. In particular, the luxury and mid-segment housing is driving realty growth in these towns.

 

  • 4.Affordable housing –The government is focused on making housing affordable to all sections of the society and under the Pradhan Mantri Awas Yojana Gramin and Pradhan Mantri Awas Yojana Urban schemes aims to achieve the objective of “Housing for All” by 2022. The union budget 2019 has made provisions for tax exemption of Rs 1.5 Lakhs to buyers on home loans under affordable housing.[2] These initiatives are driving demand for quality but affordable housing in the budget homes segment mainly from the working professionals in top 5 cities in India.

 

  • 5.RERA impact –Implementation of RERA in 2016 was a game-changer for the real estate industry. Although the industry struggled initially coping with the new rules and regulations, RERA has made the home buying process transparent for the buyers. The home buyer’s rights have been strengthened and ensure a structured timeline of project status, timely completion of projects, and accountability for the builder to avoid hidden costs. Also, the rules are clear and strict regarding penalties on builders who violate RERA norms.

 

  • 6.Rental property appreciation –In addition to the growing demand for residential property purchases in top tier cities and towns in India, the rental properties have also shown a marked increase in demand, mainly on the back of working professionals migrating and relocating for improved job prospects and a better standard of living. Delhi, Mumbai, Bangalore, Pune, and Hyderabad have shown a steady demand for both buying as well as rental properties. Also, having a second property in these cities, which is not being used by the owner, means an additional source of income for the owner.

 

  • 7.Gradual increase of technology-driven sales pitch-The internet is all-pervasive today. There is nothing that one can purchase online. So, although one cannot buy a home online without actually seeing it, the initial research in terms of selecting a location, availability of properties, pricing, reputed builders, amenities, infrastructure is being done via online searches. Developers and brokers all have an active digital presence to aid their sales pitch.Smart homes that are technologically connected are more in demand. Many builders offer high tech but sustainable DigiHomes that combine the best of technology with natural surroundings, green spaces and good air quality.One such premier residential project is Emaar DigiHomes offering 2 BHK and 3.5 BHK luxury homes in Gurgaon (Gurugram). Emaar Properties, a global leader in construction and development of iconic properties, such as the Burj Khalifa, among others entered the Indian realty market in 2005. Since then, Emaar India has developed residential as well as commercial spaces in Gurugram, Delhi, Mohali, Lucknow, Jaipur, Indore and Chennai.

Emaar DigiHomes located in the coveted address of Sector 62, Golf Extension Road, offer 2 & 3 BHK apartments in Gurgaon. These voice-enabled smart, spacious homes present a grand view of the Aravali mountains along with a host of world-class amenities including 30000 sq.ft clubhouse, infinity temperature-controlled swimming pool, wide open & green spaces all within the premises of a safe, secure and gated community. To find out more please visit the website.

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