2017 was a major year of reforms for the Indian real estate sector. It began in the aftermath of demonetization and witnessed Benami Properties Act, RERA and GST during the year. But India's unfading love real estate is expected to take it to new heights in the coming years. "In the physical assets space, Indians love for real estate will continue. Wealth held in real estate is likely to double to Rs 121 lakh crore over the next five years. This indicates a revival of growth in real estate sector in coming years on the back of increased transparency in regulations along with renewed focus on affordable housing segment," said Abhijit Bhave, CEO, Karvy Private Wealth.
Affordable Housing has emerged as the driver of real estate growth through 2017. Home Finance being at record low interest levels, has provided the extra ‘boost’ needed to ensure that a home seeker finds a ‘dream home’ becoming a reality. With Affordable Housing emerging as the rising star, the Government also made efforts to boost the mission of "Housing for All" by 2022.
Also, some policy reforms under PMAY, which hiked the earlier MIG-1 carpet area of 90 sq m to 120 sq m and the earlier MIG -2 carpet area of 110sqm to 150 sq m. sent right signals to the sector.
It is not just the regulatory regime, tweaking policies as also introducing new policies has been a ‘work in progress’ scenario in India across 2017. Over the years, the industry has been communicating with various governments about changes required in policies so as to give a positive boost to real estate – and we have seen this happen in the ‘affordable housing’ segment. We need such positive changes in policy across all segments of real estate, said Niranjan Hiranandani, President, NAREDCO.
“The Government’s ambitious ‘Housing for All by 2022’ mission also received a massive thrust in 2017 with the granting of the very vital infrastructure status to affordable housing. In addition, the definition of affordable housing and houses classified under MIG underwent a series of tweaks to cover a larger buyer base and help developers offload their budget homes inventory,” said Anuj Puri, Chairman – ANAROCK Property Consultants.
Ramesh Nair, CEO & Country Head, JLL India said, “For the real estate industry, 2017 was a watershed year, with the roll-out of game-changing policies such as GST and RERA. REITs are set to provide investment opportunities to smaller investors next year. India’s real estate markets are poised for growth in the medium-to-long term on the back of higher transparency and further consolidation. India’s Tier 1 cities are expected to move up from their current 36th rank in JLL’s 2018 Global Real Estate Transparency Index (GRETI) on the back of continued improvements in structural reforms, implementation of RERA and GST aimed at making India a modern economy.”
Ashok Mohanani, Chairman EKTA World and Vice President NAREDCO WEST was of the view that the year 2017 will make its space in the books of history as one of the difficult years for the residential segment in real estate sector.
Going forward, the sector has high expectations from 2018. The reforms of 2017 is expected to take the sector to new heights. Home buyers and investors will have more faith in the sector due to the recent government regulations.
For sure, home buyer confidence is reviving, and more fence-sitters will spring into action in 2018. We may not see a scintillating residential market recovery in 2018, but it is certain that whatever recovery and growth we see from here onward will be sustainable and backed by stronger market fundamentals than ever before, said Anuj Puri.
A green revolution in real estate is expected in 2018 with green buildings, usage of green materials and waste management techniques as real estate buildings contribute to 46% of carbon footprint and government wants to adhere to the targets set by the Paris agreement in reducing them, said Amit Wadhwani, Director Sai Estate Consultants.
“The Indian real estate market is expected to touch US$ 180 bn by 2020. 2018 will see a positive trend and developers focusing on execution.
Consolidations & Joint developments will see a rise and the sector will be left with credible brands leading to higher consumer confidence,” said Ashok Mohanani.