Real Estate Trends – Page 30

General Elections: The Real Estate Connection

Anuj Puri, Chairman – ANAROCK Property Consultants

A new Government with a clear majority raised optimism in 2014
Nearly 5.45 lakh units launched in the year and nearly 3.43 lakh units sold – the previous year saw the launch of approx. 4.6 lakh units and lower sales
Long-term benefits of recent reforms will accrue only with the continuity of their enforcement by this or the next Government

During an impending general election, real estate stakeholders conjecture about their likely impact on the real estate market.

Conventionally, the period between the announcement of the election date until the final result day is a period marked by caution and hesitancy in the overall real estate market.

While investors generally refrain from making market plays in this waiting period, buyers may also adopt a wait-and-watch stance.

The reasons can vary from anticipation that a newly-elected Government may offer more sops to homebuyers to the hope that a re-elected Government may reward voters with such sops.

In this period, developers understandably prefer to focus on selling their unsold stock rather than launching new projects.

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

GST rate cut or not, GST-exempt ready-to-move draws maximum sales
Of the total unsold stock of 6.73 lakh units in the top 7 cities, only 13% are ready-to-move-in
Of 5.88 lakh unsold under-construction units, 20% to be completed in 2019 – the addition of 1.16 lakh RTM units
Can a marginal tax saving on overpriced properties trigger sentiment revival in delay-tainted under construction segment?

The recent interim budget announced fresh sops for the Indian real estate sector – which, on closer scrutiny, did not really send clear revival signals to the market at all. Now, the strident demand for lowering GST rates on under-construction properties is on the table.

In fact, the prime minister and finance minister have proactively assured that they are considering this collective demand from the industry positively. Will a GST cut infuse enough positive sentiment to help the languishing real estate sector revive?

Perhaps, rather than debating whether a GST cut will do the trick, we should ask ourselves whether it would actually solve the ‘real’ problems the sector is facing.

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

The doomsayers are having a field day with predicting that Brexit will cause the UK real estate market to dry up and blow away. In India, we are quite used to gleeful prophecies of doom regarding real estate and take them with a healthy pinch of salt.

No doubt, every change involves disruption and confusion in the beginning. In the case of Brexit, the magnitude of change is undoubtedly massive considering the sheer size and also the diversity of the involved countries.

It is not only their economies which will be affected – like in every death or divorce, there will also be grief. Grief is an emotion, and for that reason, it will affect market sentiments for a while.

If we apply to the process of the Five Stages of Grief outlined by Elisabeth Kubler-Ross, we can see that the involved countries have already moved from denial and anger to bargaining and depression.

What inevitably follows is acceptance – and with acceptance comes the restoration of normalcy, stability and even growth.

Brexit is currently the source of a lot of uncertainty,

by Santhosh Kumar

Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants

Bangalore, Hyderabad & Chennai saw a 77% increase in new residential supply in 2018; NCR 16%, MMR & Pune 17%
Chennai led new launch supply with a 98% increase, Bangalore 91%, Hyderabad 43%
Bangalore, Hyderabad & Chennai saw a 20% increase in housing sales; 18% in North, 15% in West

The year 2018 was a mixed bag of highs and lows for the Indian real estate sector. The initial pangs of policy alterations seemed to fade away with each region seeing visible signs of recovery across segments.

Even as the liquidity crunch and stalled/delayed projects continue to plague the sector, the main southern cities of Bangalore, Chennai and Hyderabad actually saw faster growth momentum than their northern counterpart NCR.

Retail, commercial and residential real estate saw a lot more activity in Southern cities than in the North.

Residential

As per ANAROCK data, the southern cities raced far ahead of those in the North, including entire NCR.

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

India continues to strive for a more globally-aligned image for urban living conditions, which is what the Smart Cities mission is really all about.

However, the primary need if India’s housing market is to rank higher on global benchmarks of urban liveability is still a numbers game. Access to quality affordable housing, if ‘quality’ is primarily defined by location, is still a major challenge for most Indian citizens.

The dearth of affordable homes is only widening, with deficit numbers predicted to reach 30 million by 2022. This, despite the fact that the current Government has clearly understood that quality, quantity, availability and affordability of housing are integral drivers for a country’s economic competitiveness.

To be fair, India has ramped up massively on affordable housing, and this segment has been leading the pack in Indian real estate over the past 3 to 4 years.

The massive impetus that the Government has given to the one electoral promise which got the most attention – Housing for All by 2022 – has certainly caused a major sea-change.

Thanks to this impetus,

by Santhosh Kumar

Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants

Just 63,000 ready units currently benefit out of total 6.73 lakh units across top 7 cities
Nearly 22,000 ready unsold units completed before 2017 don’t benefit from new rule
33% of 5.88 lakh unsold under-construction units in the luxury segment – 49% in MMR – will not benefit immediately

Just when the real estate industry was preparing to give the budget a complete thumbs down, the finance minister sprung a surprise ‘bonanza’ for the sector in the last 10 minutes of his speech. Or so it seemed.

Without a doubt, affordable housing gained amidst what was essentially a mass-appeal budget. However, it was the extension of tax relaxation on notional rent for unsold inventory for another year that cheered developers.

However, under closer scrutiny, it is unlikely to benefit a majority of them as on date.

Anti-climax for developers

Basically,

by Arun Chitnis

PRESS RELEASE

Chennai Overtakes Bengaluru, Unsold Inventory Less Than 50% Of IT Capital – ANAROCK Report

Chennai’s current unsold housing stock at 30,800 units against 73,300 units in Bangalore
Avg. property prices lowest in 4 years at INR 4,900 per sq. ft.
72% new supply in last 6 years in under INR 80 lakh budget range
PE investment increased by 15% in 2018 against 2017

Chennai, 4th February 2019: Bucking all odds including political uncertainty and a major natural calamity, Chennai has trumped southern counterpart Bengaluru in terms of upbeat residential real estate activity.

ANAROCK‘s report ‘Chennai: From Resilience to Growth‘ confirms that the city is only behind Hyderabad in unsold stock numbers, and has the second-lowest unsold housing inventory of India’s top 7 cities in India.

As the event’s knowledge partner, ANAROCK released the report at RECON, an initiative by Tamil Nadu Real Estate Consultants Association, in Chennai today.

Anuj Puri, Chairman –

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

The interim budget was more or less a vote bank-facing exercise – an electoral pitch that drew attention to past achievements.

Vote-bank directed announcements included benefits to 12-crore small farmers via credit of INR 6k/year directly into their bank accounts, and also to 10 crore labourers by way of direct pension bonanza.

Direct and indirect positives for the real estate sector

Boost to Affordable Homes:

People earning up to 5 lakhs will get a full tax rebate. However, if one invests in specified Government saving schemes then the tax exemption extends to Rs. 6.5 lakhs. This can have good implications for affordable housing, but not really on the mid-income housing.

The Government also extended the benefit of tax exemption for developers by 1 more year, up to 2020 now. This, too, will give a push to the affordable housing segment.

Electricity for all by 2019 could have positive implications by making more far-flung areas liveable and therefore more viable for affordable housing.

The standard deduction for the salaried class was raised from Rs.

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

Of the total current 6.73 lakh unsold units across top 7 cities, approx. 85,000 are ready-to-move-in
NCR & MMR together account for 54% total unsold RTM homes
Hyderabad has least unsold RTM stock priced below Rs. 80 Lakh with approx. 3,040 units

Indians looking to buy homes in 2019 have a very compelling rationale to opt for ready-to-move (RTM) homes, which – apart from being exempt of the 12% GST ambit – are available plentifully.

As per ANAROCK data, out of the total 6.73 lakh units of unsold housing inventory, nearly 85,000 units are currently ready-to-move-in across the top 7 cities. Interestingly, out of these total unsold ready-to-move options, nearly 60% of units are in the affordable and mid segments priced below Rs. 80 lakh.

RTM quotient of Unsold Stock

Cities	Total Unsold Units Approx.	RTM Units Approx.	RTM % of Total Unsold Units
Bangalore	73,340	12,000	16%
Chennai	30,840	8,800	29%
Pune	87,440	8,600	10%
Kolkata	49,470	5,400	11%
NCR	1,86,710	23,500	13%
MMR	2,19,490	22,300	10%
Hyderabad	25,960	4,400	17%
PAN India	6,73,210	85,000	13%

Source: ANAROCK Research (RTM= Ready-to-move-in)

Currently,

by Shajai Jacob

Shajai Jacob, CEO – GCC, ANAROCK Property Consultants

Regulations for property acquisitions by NRIs
Returns on investment in different real estate asset classes
Documentation, home loans, tax implications compliances
Best cities and micro-markets in which to invest

Whether the real estate market remains bullish or bearish, NRIs prefer a place back in India – not just for investment returns but also to remain rooted in their country of origin.

Previously, NRIs (like most other buyers and investors) had every reason to be leery of the Indian real estate market. Today, game-changing policies like RERA and GST have now boosted confidence and transparency and streamlined the property-buying process for NRIs.

This has begun fuelling new NRI investments into the Indian property market. The fact that the rupee value against dollar depreciated in 2018 was also a sound reason for NRIs to view Indian real estate more favourably.

And, of course, developers have been offering substantial freebies and even discounts, apart from interesting payment plans, to draw NRIs as well as domestic buyers to their projects.

General Elections: The Real Estate Connection

GST Rate Cut – Panacea or Brief Pain Relief for Real Estate?

Brexit: How The Big Divorce Will Impact Indian Investments In UK Real Estate

Southern Cities Took the Lead for Real Estate Activity in 2018

Why Is Affordable Housing In India Restricted To The Peripheries?

Only 9% of Current Unsold Housing Stock to Benefit from Tax Relaxation

Chennai Overtakes Bengaluru, Unsold Inventory Less Than 50% Of IT Capital – ANAROCK Report

Interim Budget 2019: Affordable Housing Gains Amidst High Electoral Pitch

Unsold Inventory: 60% Ready-To-Move Homes Priced Below Rs 80 Lakh

NRIs, Know The Score Before Buying A Property In India