Affordable Segment to Drive Future Growth, Housing Demand Subdued
The affordable segment is seen as the growth driver in the coming months, experts says despite the demand in the residential markets across cities remains sluggish, notwithstanding the implementation of the Real Estate (Regulation and Development) Act, 2016 (RERA), and the Goods and Services Tax (GST).
To tap the investment sentiments associated with the festive season and counter the subdued markets, developers have started offering innovative marketing schemes aimed at increasing the sales of unsold properties.
Some green shoots of revival in the housing sector, but they are very tender right now. GST and RERA have helped infuse a new sense of confidence among buyers, but there is still a lot of confusion about them and RERA has not even become a nation-wide force as yet.
More developers are now considering “moving into or expanding” their portfolio in affordable housing, that addresses the housing needs of the lower or middle income households.
According to the latest research report by leading global real estate services firm Cushman & Wakefield covering the top eight cities of India, the affordable housing sector has recorded a surge of 27 per cent in new units launched year-on-year.
According to analysts, developers have refrained from fresh launches and are focusing on clearing their existing inventories. This approach has resulted in a gradual reduction of unsold units.
They have increased marketing schemes such as interest subvention, possession-linked payment plans, price guarantee schemes and waiver of floor rise to defy the weak market conditions.
With some exceptions in terms of micro-markets which are bucking the trend, price growth has been flat across most cities over the past one year.
The total housing credit growth has been range bound in the financial year 2018 (April-July). The disruptions in the real estate market have tempered the growth of housing loans. Notwithstanding the short term glitches on account of RERA and GST implementation, the housing loan growth is expected to be healthy at 16-18 per cent for FY 2018.
Source Link- https://www.dayafterindia.com/2017/10/17/housing-demand-remains-subdued-affordable-segment-drive-future-growth/