How will be Year-2019 for Home Buyers?
How will be 2019 year for Indian Realty market and home buyers? We examined the scenario across various segments in the Indian Real Estate and presenting you with few facts and assertions from top industry leaders.
Positive Developments for Realty Industry
Over the past few years, the Indian real estate sector has witnessed various structural improvements, with regulations and schemes like;
- Pradhan Mantri Awas Yojana (PMAY) - Affordable housing for everyone
- 100 % Tax exemption on the profit for developers building affordable houses
- Implementation of the Real Estate (Regulation and Development) Act, 2016 (RERA)
- Subsidy schemes for first time Homebuyers.
These schemes certainly give a push towards India's infrastructural development making it an ideal time to invest in real estate. Taking an early decision to invest, helps in huge savings as price appreciation in the later stage of property projects/ventures is much faster than the initial stage, in any residential or commercial locality.
Urban Area Development
The recent infrastructure development plans of Hyderabad city points out better mobility options for people. The faster completion of metro lines, construction of more highways and other infrastructural developments, are closing the gap between distant places. Such kind of infrastructural developments are facilitating a robust real estate industry prospects not only in Hyderabad but also in other small and bigger cities of India.
With the TRS party continuing with the power in the Telangana state, the property buyers will surely get a good return on investment in the near future as the on-going infrastructural projects will further continue to develop without any obstacle.
Large scope for Mid-Segment Residential Properties
Real estate industry experts are of the view that there exists a large scope for demand in the affordable and mid-priced segment in residential housing projects. This can be concluded from the fact that the second half of the 2018 year has seen resurgence in the residential property market in all major cities of India including Mumbai and Hyderabad. This surely provides a roadmap for the 2019 year and may incur better conversion rates for developers - building houses and catering primarily to mid-segment property buyers.
The major impetus has been due to:
- Central government's decision to grant the infrastructure status to 'Affordable Housing' segment
- Lower GST (Goods and Services Tax) rate on this segment and no GST on Ready-to-move-in apartments.
- Easy financing options
These steps gave a huge relief to home buyers and enhanced the housing demand in the market in
the year 2018 and further streamline the overall growth in real estate in the 2019 year too!
GST on under-construction properties may reduce in 2019
Presently the ready-to-move-in residential properties for sale are exempted from GST rates while the under-construction properties are levied with 12% GST rate. This has proved to be a major deterrent for home buyers for purchasing any yet-to-be completed properties. The government plans to rationalize the GST rates further and can boost the property sale, helping both developers and end-users with better returns.
The scope of revival in Second Home segment
People are nowadays more exposed to global trends through their travels, nationally and internationally. There is much demand for uniquely designed homes for home buyers with higher income groups.
Industry experts have asserted that people appreciate and value homes - that have unique and aesthetic designs, as it enables them to have a fresh experience. The tourist destinations are also favored locations for second home buyers, as they want to enjoy a peaceful gateway with friends and family, away from their busy urban lives.
With the revival of the economy, there has been a slow and steady increase in demand for the second home segment with better return opportunity for buyers.
Best Time to Hit the Deal
The top real estate investors point out that this is the most apt time to buy a home and home seekers should take advantage of the time.
The home buyers can secure better deals and discounts from developers as most of them are struggling with excess inventory and holding back on launching new projects.
As the demand-supply gap is likely to increase thereby giving an opportunity to investors as well as to developers, a good return on investment. The investors will benefit by appreciation in the capital values or rental income.
The developers have also become aware of home buyers demands and offer semi/fully furnished homes, easy subvention schemes. Also, the easy availability of home loans are some of the best reasons why home buyers should not wait for too long to take a real estate investment in the year 2019.