Among the factors contributing to the escalating claustrophobia effect of shrinking apartment sizes, demand for affordable homes in metros tops the list.
Category: Affordable Housing
The government’s slew of measures to revive the automobile industry, will curtail the deeper impacts of the slump on other sectors, including housing.
Anuj Puri, Chairman – ANAROCK Property Consultants
As India embarks on another year of independence, the country’s real estate sector has a lot to be grateful for, a lot to hope for – and still a lot to worry about.
Amidst the dual challenges of liquidity crisis and stuck projects that hang like persistent thunderclouds over the sector, we nevertheless inch closer to the ultimate goal of Housing for All by 2022.
From the viewpoint of stuck and delayed projects, the freedom to buy homes has turned into shackles for many.
Over 1.74 lakh homes in 220 projects across the top seven cities are completely stalled. Housing worth over INR 1.77 lakh Crore is in limbo with zero construction activity.
The affected buyers exercised their freedom of choice – only to see their hard-earned money imprisoned with scarce prospects of parole until recently.
Nevertheless, this state of affairs is not unilateral and countless more Indians have indeed successfully achieved freedom from rent.
Though not nearly as fast as can be hoped for, housing sales are picking up. In sharp contrast to earlier years,
Anuj Puri, Chairman – ANAROCK Property Consultants
The hard facts of declining consumption and a deepening economic slowdown in India are inescapable, and real estate has been severely impacted by them. To this gloomy backdrop, the RBI’s repo rate cut of 35 bps to 5.4% announced in the latest monetary policy is obviously welcome.
This rate cut, the fourth consecutive cut since February 2019, is meant to boost consumer sentiments once commercial banks transmit the benefits to actual consumers.
For real estate, a rate cut of 35 bps is however insufficient to significantly improve buyer sentiment in the mid-income segment, which still has a staggering unsold inventory of 2.17 lakh units in the top seven cities. On the other hand, demand for affordable housing, which accounted for 2.40 lakh unsold units in these cities, may see improvement as this highly budget-sensitive segment already has the benefit of other incentives.
Even minor downward revisions in interest rates can and do make a difference in affordable housing. If banks transmit this reduction in the prime lending rate to consumers, budget housing demand may improve. Likewise, housing demand in tier 2 and tier 3 cities,
ANAROCK data reveals that of the total housing supply of 1,39,490 units in the top 7 cities H1 2019, merely 39,840 units meet these criteria
ANAROCK research indicates that housing sales in Q2 2019 fell by 13% q-o-q and stood at 68,600 units across the top 7 cities.
The Union Budget 2019-20 budget had a few hits and misses for real estate, but infrastructure and affordable housing under the PMAY scheme got a boost.
Anuj Puri, Chairman – ANAROCK Property Consultants
Like it or lump it, but Modi’s victory in 2014 ushered a new era in Indian real estate – starkly marked by his vision to set the ‘house’ in order and alter the scarred face of an unorganized sector beset by unscrupulous activities.
He tightened the Centre’s grip on real estate – previously the largest dump-yard for black money hoarders – and introduced big-bang schemes to benefit consumers.
From major policy overhauls to amendments in old Acts, from a decisive impetus to infrastructure development, and from the arguably Utopian 100 Smart Cities and Housing for All by 2022, one thing is clear – the Modi government set the stage for Indian real estate to flourish in the long-term.
The measures he took to achieve this did have short-term negative impacts, but nobody can argue that this is a case where short-term pain is necessary for the sake of long-term gain.
That said, the on-ground implementation for most of these initiatives is far from what could have been achieved even in just five years.
Let’s examine the five major initiatives Modi undertook for the real estate sector –
- NCR and MMR account for 55% share of total 6 lakh affordable units launched across the top 7 cities; NCR saw maximum supply
- Of the total 3.98 lakh units sold in sub INR 40 lakh category, NCR & MMR hold 57% share
- Pune comes next with 1.13 lakh units launched and approx. 75K units sold in the affordable segment
- Bengaluru, Chennai & Hyderabad saw the least activity in the affordable segment
Mumbai, 15 March 2019: It is the biggest shift that the Indian real estate market has seen so far. The previously ‘unaffordable’ real estate markets of NCR and MMR have led the thrust of affordable housing – in both new supply and housing sales – over the last five years.
ANAROCK Property Consultants‘ latest report ‘Affordable Housing: The Blue-Eyed Boy of Indian Real Estate‘ confirms that these two regions contributed a whopping 55% share of the overall new budget housing supply between 2014 and 2018.
The report, which knowledge partners ANAROCK unveiled at the CII Real Estate Confluence 2019 in Mumbai today,
CII Real Estate Confluence 2019, Mumbai – Friday, 15 March
Maharashtra Real Estate: Ahead of the Curve – Refine. Reboot. Re-emerge
Date & time: Friday, 15 March 2019, 1730 hrs
Venue: Ballroom, Hotel Taj Land’s End, Bandra, Mumbai
- Inaugural Address – Gautam Chatterjee, Chairman – Maharashtra Real Estate Regulatory Authority (MahaRERA)
- Theme Address – Anuj Puri, Chairman, CII Real Estate Confluence 2019 – Chairman, ANAROCK Property Consultants
- Keynote Address – Abhishek Lodha, MD & CEO – Lodha Developers Ltd
ANAROCK Property Consultants are knowledge partners at the CII Real Estate Confluence 2019 to be held on Friday, 15 March in Mumbai.
This year’s conference theme ‘Maharashtra Real Estate: Ahead of the Curve – Refine. Reboot. Re-emerge’ is aptly chosen for the state which has been the forerunner in RERA adoption and implementation. ANAROCK, in partnership with CII, will also unveil its latest report ‘Affordable Housing: The Blue – Eyed Boy of Indian Real Estate’