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.

Anuj Puri, Chairman – ANAROCK Property Consultants

  • Benefits aside, a cut could have been a major setback to the affordable housing segment
  • GST rate cut, clarity on / abolition of ITC – boosted demand vs. actual sales

After much anticipation, the GST Council has failed to deliver a final verdict on GST applicable on real estate – but how much would it really have mattered?

Here’s a Utopian vision – the government would announce a GST rate cut, homebuyers would cheer up since prices would reduce marginally, and the market revives. Really?

The biggest paradox in Indian real estate is that numbers suggest a massive burden of unsold housing stock in the midst of a chronic shortage of housing. As long as prices don’t reduce significantly, the housing shortage will only widen regardless of tax sops.

What we have today is a nation of aspiring homebuyers, many of which are perpetually on the fence, waiting for a slew of minor policy windfalls to cumulatively make a home purchase feasible and attractive.

Housing Growth

Affordable Housing Keeps the Momentum Going  

Anuj Puri, Chairman – ANAROCK Property Consultants

  • Unsold inventory down 2% from 7.11 lakh units in Q1 2018 to 7.0 lakh units in Q2 2018
  • Unsold inventory declined 10% from 7.7 lakh units in Q4 2017

 There has been a whopping 50% jump in overall new housing launches in Q2 2018 over the preceding quarter, with the maximum supply in the affordable segment (< ₹ 40 lakh).

Interestingly, the affordable housing supply increased by 100% in Q2 2018 over Q1 2018, and this supply has led the overall growth.

On the sales front too, housing sales across the top 7 cities of India also rose by 24% compared to Q1 2018, indicating that hitherto abstaining home buyers are back on the market.

Developers are working hard on clearing unsold inventory with attractive schemes, freebies and discounts. Moreover, the positive impact of the policy reforms including RERA and GST have begun to bear fruit.

ANAROCK Property Consultants are exclusive marketing partners

  • 5 typologies of apartments from 1BHK to 3 BHK, only four flats per floor

  • Attractive prices starting from Rs 18 lakh (inclusive of stamp duty, registration and other taxes)

Peninsula Land Limited, a leading corporate real estate developer which is part of the Ashok Piramal Group, today announced its foray into the affordable housing segment with the launch of its new project `addressOne` at a press conference.

Located at Gahunje, Pune, addressOne is spread across 50 acres and is strategically located on the Mumbai-Pune expressway, next to the MCA cricket stadium.

addressOne will be exclusively marketed by ANAROCK Property Consultants, who also launched an exclusive report on Gahunje’s growth from fringe area to growth precinct.

Download the report here: https://bit.ly/2Hbyqes

addressOne‘s strategic location just off the Mumbai Pune Expressway connects the project to Hinjawadi, which is less than 10 km away.