Many markets within Mumbai market
With a multitude of tax sops and incentives being announced to improve market sentiments in an election year, make Gudi Padwa an opportune time for your dream home search
REFORM AND REGULATE:
Beginning with demonetisation to RERA, Benami Transactions Act and GST, the previous five years have seen a series of high impact policies that resulted in greater transparency and trust in the system. The latest GST rate cut to five per cent (and one per cent for affordable housing category) is easing the cost burden on buyers.
However, there is no doubt that many stakeholders adopt a wait-and-watch approach during a pre-election phase. Anuj Puri, chairman, ANAROCK Property Consultants explains, “Conventionally, the period between announcement of the election date till the result day is a period marked by caution and hesitation. While investors generally refrain from making any moves, buyers also adopt a wait and watch stance. In this period, developers prefer to focus on selling their unsold stock, and this is favourable for homebuyers as they can do some hard bargaining.”
The RBI’s decision to cut repo rate by 25 basis points translates into marginally lower EMI outflows on home loans. “The rate cut is unlikely to have a real impact on sales now. The home-buyer today ends up on a floating rate and realises it’s not wise to use current interest rates as a key criterion for timing the home-buying decision,” advises Joe Verghese, managing director, Colliers International India.
Execution is three fourths of good decisions and hence, Aashish Agarwal, head – consulting, Colliers International India, feels, “The softening in stance from calibrated tightening to neutral reinforces the message that the government wants to increase private investment and consumption. However, the impact of this hinges on the willingness of banks to pass on the benefit to consumers.”
REAL GAINS OVER SENTIMENTS:
Home-buyers who are already making a huge investment into their dream homes are predisposed to counting every rupee that adds up to the final landing cost of their home. Here’s where the recent GST reduction (applicable on under-construction launches from 1 April, 2019, onwards) adds significant value. Dr. Samantak Das, chief economist and head – research and REIS, JLL India, elaborates, “By
THE WAY FORWARD:
Fair elections are the sign of a healthy democracy and it is unlikely that elections are going to impede real estate growth. Dr Das explains, “No government or political party is against reform; it is only the pace of implementation that is debatable. Irrespective of the election outcomes, the real estate industry will continue to grow. Reform reversal is not possible and hence, we are only going to see further implementation, especially with RERA, which has realistically been executed only in Maharashtra. We are hoping that stamp duty and registration will be subsumed under GST, but that is not likely at least in the short-term.”
Projects to look out for: