The Indian real estate sector is the second largest employment sector after agriculture. It comprises of four sub-segments—commercial, housing, hospitality, and retail. The real estate industry is expected to reach $180 billion by 2020 with the housing sector contributing 5% to 6% to the Gross Domestic Product (GDP).
This industry has seen an increase in the demand for both commercial as well as residential spaces. The surge in the real estate industry is the result of higher debt and private equity investments.
Additionally, the government has taken multiple initiatives for the growth of this sector. Some of these include the Pradhan Mantri AwasYojana (PMAY) to boost affordable housing.
The easy availability of affordable housing loans is another factor that has contributed to the growth of this sector. Although the Union Budget 2018 does not directly impact the real estate sector, it achieves a balance with the focus on affordable housing.
Limited direct impact
Compared to the last three years, this year's Budget has a little direct impact on the real estate sector. With the recent regulatory changes such as demonetization and Real Estate Regulatory Act (RERA), the industry was expecting some major announcements. However, no meaningful interventions were announced
Focus on affordable housing
The Government continues its focus on affordable housing with a new fund. This housing fund set up under the National Housing Bank will offer affordable home loan interest rates on the priority sector lending. It is expected that real estate developers will be more involved in the affordable housing sector with this new impetus.
After demonetization, the resale market has witnessed a slowdown. In several major cities, the revised circle rates exceeded market rates, which reduced liquidity. The Budget provides relief of five percent between the two rates. This will provide some relief and give a boost to the secondary real estate market.
Rural focus
Another impact that may bring positive result is the focus on increasing farmers’ incomes. As a result, consumption is expected to see a boost thereby increasing the demand for easy home loans. As farmers have more disposable income, it will eventually have an indirect effect on the real estate as the demand for affordable housing increases.
Although the Union Budget may not have any direct impact on the real estate sector, the availability of affordable housing loan interest rates is expected to combat this limitation. Banks and non-banking financial companies (NBFCs) are offering quick and affordable loans to boost demand.
Lenders offer longer repayment tenure with flexible Equated Monthly Installment (EMI) schedules to enable borrowers to repay on time without facing any financial difficulties. Apply for a home loan and live your dream of becoming a homeowner.
This industry has seen an increase in the demand for both commercial as well as residential spaces. The surge in the real estate industry is the result of higher debt and private equity investments.
Additionally, the government has taken multiple initiatives for the growth of this sector. Some of these include the Pradhan Mantri AwasYojana (PMAY) to boost affordable housing.
The easy availability of affordable housing loans is another factor that has contributed to the growth of this sector. Although the Union Budget 2018 does not directly impact the real estate sector, it achieves a balance with the focus on affordable housing.
Limited direct impact
Compared to the last three years, this year's Budget has a little direct impact on the real estate sector. With the recent regulatory changes such as demonetization and Real Estate Regulatory Act (RERA), the industry was expecting some major announcements. However, no meaningful interventions were announced
Focus on affordable housing
The Government continues its focus on affordable housing with a new fund. This housing fund set up under the National Housing Bank will offer affordable home loan interest rates on the priority sector lending. It is expected that real estate developers will be more involved in the affordable housing sector with this new impetus.
After demonetization, the resale market has witnessed a slowdown. In several major cities, the revised circle rates exceeded market rates, which reduced liquidity. The Budget provides relief of five percent between the two rates. This will provide some relief and give a boost to the secondary real estate market.
Rural focus
Another impact that may bring positive result is the focus on increasing farmers’ incomes. As a result, consumption is expected to see a boost thereby increasing the demand for easy home loans. As farmers have more disposable income, it will eventually have an indirect effect on the real estate as the demand for affordable housing increases.
Although the Union Budget may not have any direct impact on the real estate sector, the availability of affordable housing loan interest rates is expected to combat this limitation. Banks and non-banking financial companies (NBFCs) are offering quick and affordable loans to boost demand.
Lenders offer longer repayment tenure with flexible Equated Monthly Installment (EMI) schedules to enable borrowers to repay on time without facing any financial difficulties. Apply for a home loan and live your dream of becoming a homeowner.
No comments:
Post a Comment