The real estate world has been on a rollercoaster due to the recent political and economic reforms taking place in the country. Last year we say the demonetisation fiasco, the establishment of RERA and implementation of GST. We can easily say that the market is headed towards a new direction altogether, based on the widespread changes that took place due to these activities.
We have shortlisted five such trends that will change the real estate sector in India and will influence any property decision you make.
A Clearer Exchange of Information
The first noticeable change that took place was how the information regarding the sale and purchase of properties was exchanged. Before the establishment of RERA, there was no standardised way by which builders would appeal to the masses and interested buyers would actually buy an apartment without having to go through a mountain of troubles.
The whole architecture that governs the flow of information from the buyer to the broker and beyond has been eased with the help of better policies at place. The government is taking important measures to make it easy for all the participants of the real estate business to carry out commercial activities.
The capital requirements for Indian real estate market have been met sources like pension funds and private equity funds, when RBI refused to save the flimsy market by offering its supremen help. RBI has been wary of spending in Real Estate due to the high percentage of uncertainty that the market brings along. Hence, the developer and buyer communities found alternative ways to source capital, in the form of non-institutional funds.
A Rescue-based Business Model
The number of bankruptcies that came forward due to poor real estate performance were too high to deal with and warranted an inevitable demise of the market. This was the time when bigger players landed in the competition and acted as godfathers for these smaller land owners and builders. The resultant was the formation of joint ventures, agreements and business set ups that facilitated the consolidation of poorly performing sector.
The same trend is expected to continue and keep adding more significant rescues to the list.
FDI in Indian Real Estate
India has received ton loads of foreign investment in real estate for a number of good reasons. The overall GDP has grown, the government is playing lenient and there have been policy changes prompting the large investments being made by foreign investor houses to gain a profitable corner in India’s market.
This and private equity are two things that are helping Indian developers to realize their potential, especially when the banking support has been missing.
Green Space Leader
It would come as a surprise to many but India is currently leading the global green building competition and has acquired the 3rd spot worldwide. No one would have expected such a huge turn around when India’s green building cover was infinitesimal as compared to today’s 4.5 billion square feet.
The same trend is expected to catch more fire with fueling being constantly done by Indian organizations promoting the set up of green office spaces.
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