How Blockchain Will Transform the Indian Real Estate Sector

In June 2018, an E. Coli (bacteria, usually harmless) outbreak across the US, from consuming romaine lettuce sourced by Walmart, resulted in the death of 5 people. The Food and Safety Department found out the reason behind the outbreak in 7 days. However, using blockchain technology, Walmart was able to do this research in 2.2 seconds, which substantially reduces the likelihood of infected food reaching the consumer.

Walmart is collaborating with IBM Food Trust Solution to test a blockchain-based food supply management tool that will help Walmart keep track of information of every single leafy green vegetable that it acquires or sells. Thus, the retailing giant can trace the final product back to the specific farm it came from, suppliers it went through, the store it was sold from; ensuring every aspect of the product is traceable.

Blockchain is an incorruptible global ledger system that provides a way to record and transfer data, such that it is transparent, auditable, safe, fast and invulnerable to outages. These qualities enhance its appeal as a technology that can potentially disrupt a lot of industries and change the underlying way they function, transact, store information, deal with data, and transparency among other things.

Besides food supply management, blockchain is being tested and even trialled in industries as diverse as medicine, law, real estate, banking and airports. A recent research by PwC on blockchain revealed that about 84% respondents (600 executives of companies from 15 territories) are actively involved with developing blockchain related solutions, suggesting the popularity of the technology in the industry.

Blockchain in Real Estate

The processes in the real estate sector are archaic, extremely time consuming, paper-based, outdated, and heavily reliant on intermediaries at various stages, all of which makes it highly susceptible to fraudulent activities. Blockchain can potentially change this on a very fundamental level. It will ease the process, thereby, transforming the real estate sector into a more fluid entity. The potential benefits of applications of blockchain in the Indian real estate sector can foster trust-based transactions that are fast, transparent and binding. Here’s a look at different aspects of real estate, that blockchain technology can impact positively.

Blockchain article on HTEstates

Land Title Frauds

The Indian real estate industry faces a real challenge in maintaining, verifying and searching for title deeds. Just a fraction of them are digitally available thus making title ownership susceptible to fraud due to multiple claims of ownership. Blockchain can prevent such cases by digitising land titles. It will enable every property to have a digital address in the blockchain that consists of additional details like occupancy, finance, ownership records, specifications and attributes of the property as well as existing legal disputes, if any. These parameters would be available to everyone and will be correlatable, thereby, reducing the speed of the transaction from days/weeks/months to minutes.

Transfer of Property

Transfer of a property using Blockchain becomes a simple process. The first owner is required to ‘rehash’ (encrypt) the document in the blockchain to prove the transfer of title of the land to the new owner. The transfer process currently takes weeks/months, a lot of paperwork and a considerable processing fee. With blockchain, this interchange will barely take a couple of seconds.

Smart Contracts

Smart Contracts based on blockchain can ease repetitive transactions or contracts like rents, deposits, installments by automating them. Using a feature called ‘multisignature’ in the blockchain, two parties can enter into an automatically binding agreement. The open-source nature of smart contracts ensures that contracts are executed as dictated by the source code. These contracts, therefore, are automatic, transparent and once executed are indisputable, irreversible and unalterable thus ensuring high confidence among users.

Disintermediation

The real estate sector suffers from an over-reliance on various intermediaries like brokers, registration officers, banks, notary, etc as these middlemen hold key information/access that isn’t available to the common man. Blockchain, as a decentralised medium would help bring all this information on to a common platform and enable its distribution, thereby ensuring that the information is transparent and hence, available to everyone minus the various fees that one pays during the process.

Additional Uses of Blockchain in Real Estate

Blockchain can also empower online real estate markets by upgrading their abilities and functionalities. Right now, the portals serve as a means of connecting people to real estate properties by providing information about the property and assisting in site visits. With the advent of blockchain, these real estate markets will be converted to something like a stock market allowing buyers to find sellers and execute real estate transactions on-the-go.

The transparency and speed of action offered by blockchain technology will open avenues for crowd ownership or fractional ownership in real estate. These investments can be used for rental purposes, as collaterals in loans, or for personal benefit as outlined by the terms of the agreement. Further, this will also open doors for foreign investment in Indian real estate, thereby, improving the quality of living and commercial spaces.

Conclusion

Industries are resistant to change, especially when the change is transformational in nature. Blockchain as a technology is in a very nascent stage. It will take a while for the Indian real estate sector to adopt and build on the technology. That combined with forward-thinking from realty firms in convincing consumers to embrace the technology, and the government’s efforts in designing and implementing policies will decide the future of the technology. The trichotomy of RERA, demonetisation and GST has brought transparency into the system and has built the perfect environment for such transformational changes to take place. It is now up to the stakeholders to step up.

(Previously published in March 16 2018 edition of HT Estates)

Gurugram’s Real Estate Recovery in 2018

Defining the skyline of NCR- Gurgaon

Gurugram was largely responsible for the NCR real estate market making a steady recovery during 2018. The city witnessed large scale developments in the last couple of years – from public infrastructure and housing projects to commercial and retail developments. Infrastructure developments such as the Dwarka Expressway, Southern Peripheral Road, and Rapid Metro which connects areas in Gurugram such as Cyber City and Golf Course Road to Delhi and NH8, are driving Gurugram’s real estate market.

Gurugram has the third-highest per capita income in India. It is this financial muscle that realty developers are looking to capitalise on, and top developers in Gurugram have been fairly successful in doing so, especially after the implementation of the RERA Act and GST. With improved accountability and transparency, more people are returning to invest in this market.

The Haryana Affordable Housing Scheme or HUDA scheme rolled out by the Haryana government in 2013, has augmented the availability of affordable housing projects in Gurugram and other cities in Haryana. It was envisaged as a sincere attempt to provide affordable homes within the limits of the main city, and the implementation of the scheme has been fairly successful. Below we look at these and other factors that shaped Gurugram’s real estate market in 2018.

The Revival of the Gurugram Real Estate Market

Gurugram’s recovery from the jolts of demonetisation, GST and the RERA Act has been a positive one. Market analysis shows that the sector is slowly adjusting to policy changes and recovery can be observed on both the supply and the demand side. According to a report by property consultants Knight Frank, Gurugram witnessed a 35% increase in launches in 2018, and 8% increase in sales from last year. There was also a 15% reduction in unsold inventory indicating that sales and buyer confidence has picked up in the market.

Improved Infrastructure

Improved public infrastructure generally contributes to an improved real estate market. The completion of the Dwarka Expressway has had quite a direct impact on realty prices and general buyer sentiments. Further improvements and enhancements on DEW will boost Gurugram’s realty growth. Upcoming developments such as the Delhi-Mumbai Industrial Corridor (DMIC), and proposed Jewar Airport are also pushing growth in this region. These developments have ensured seamless connectivity from far-lying suburbs to the office and commercial hubs. Consequently, a number of affordable housing projects are coming up in peripheral suburbs where land rates are relatively low.

New Launches by Established Realty Developers

The region of NCR witnessed a 35% increase in the number of units launched, out of which 52% of the units were in Gurugram. Projects that are near-completion or ready-to-move-in apartments are garnering more inquiries from buyers. Established players such as Godrej, Shapoorji Pallonji, Hero, Sobha, etc. have announced a number of launches in 2018 in Gurugram, indicating the rising stocks of its realty market. Additionally, the commercial market in the NCR region has witnessed a 14% growth in leasing and a whopping 86% growth in new launches. Gurugram was also the leader in the absorption of office spaces, accounting for 66% of the absorption in the NCR region.

Push for Affordable Housing Projects

Residential inventory in Gurugram is priced relatively higher than other regions NCR. However, its relatively better infrastructure makes it an attractive market for aspirant homebuyers. To cater to this demand, HUDA launched a number of affordable housing projects in the last 2 years. Under its scheme flats are priced between 15-25 lakhs, with exemption of maintenance charges for up to 5 years and possession promised within 4 years. The flats were allotted through a supervised lottery. This scheme, as documented, has benefited thousands of families and brought the dream of ‘affordable housing for all’ closer to reality in Gurugram.

It is a model, based on a solid foundation that has found success in Gurugram and offers a template for policymakers elsewhere to follow and replicate. Also, trends such as smaller apartment sizes, integrated townships, ready-to-move-in homes are contributing to the sale of affordable housing projects in the city.

Gurugram’s real estate future’s looking brighter in 2019. A number of projects are nearing completion and attracting interest from buyers. As observed, although the first half of 2018 witnessed a rise in affordable housing projects in the Gurugram market, the second half has seen notable developers launching projects above the 75 lakh price band indicating demand for such developments. The improved infrastructure developments have further attenuated Gurugram’s desirability factor.

PMAY Update in 2018: GST reduced on houses under PMAY 

Home buyers availing the Credit Linked Subsidy Scheme [CLSS] scheme under Pradhan Mantri Awas Yojana [PMAY] for purchasing homes can heave a sigh of relief. The GST council has proposed that the Goods and Services Tax prevailing on these homes will reduced.

All under construction projects which are a part of CLSS will see a 4 percent cut in GST and will be charged at 8 percent instead of 12 percent.

Buyers who do not qualify for CLSS will continue to pay the same i.e GST at 12 percent for the same house.

Low-cost housing projects, where the maximum carpet area of units is 646 sq.ft. and have been given infrastructure status as per affordable housing definition, also fall under this GST benefit.

There has also been a change in the carpet area of houses for Middle Income Group falling under PMAY. In November, the cabinet approved that for:

-MIG-I category, the unit size was increased from 90 sq.m. to 120 sq.m.

-MIG-II category, the unit size was increased from 110 sq.m to 150 sq.m.

* Update as of June 12, 2018*

Earlier the eligibility of carpet area was 1291 sq. ft. for MIG-I and 1614 sq. ft. for MIG-II. This has now been enhanced to 1722 sq.ft. and 2153 sq.ft. 

The reduction in GST along with the interest subvention scheme will result in a significant amount of saving for buyers while purchasing homes under PMAY-CLSS. These segments of home buyers are price sensitive and even a small change makes a considerable impact on their budget and hence influences their decision to buy a home.

This scheme is expected to convince developers to pass on their savings in terms of Input Tax Credit on construction, raw materials to home buyers, reducing the actual rate they have to pay for their home.

 

Real Estate Trends Of 2018 Shaped By Events of 2017: An Analysis

RERA Act 2016

At the start of 2017, the Indian real estate sector was grappling with the after effects of demonetisation which came out of the blue towards the end of 2016. However, 2017 brought even more change in the form of the roll out of Real Estate (Regulation and Development) Act, 2016 (RERA) and implementation of Goods and Services Tax (GST). 2017 will be considered as a watershed year in Indian real estate; a year in which the boys of real estate development were separated from the men, and consolidation took place. It will remain the year in which the Indian homebuyer was given his/her due and place in what was seen as a ruthless sector.

While the majority of the notable real estate trends of 2017 were marked by regulation, some were infrastructural. The metros (both tier-1 and tier -2 cities) have seen the implementation of massive infrastructure projects, which will raise the standard of living in these metros, and as a result draw more people and developers to fulfil this demand. Affordable Housing and PMAY has also given broad hope not just to homebuyers in the lower middle class and low income category but also to developers who have been looking to make inroads into this sub-sector but have lacked the right incentives.

2018 is now underway, and as far as real estate is concerned will be dictated by the upheavals and trends of 2017. Let’s review the year gone by and what it holds for 2018.

RERA Act video
The RERA Act of 2016

Real Estate (Regulation and Development) Act, 2016 (RERA)

It was a long awaited regulation and was expected to be homebuyer-friendly. RERA has introduced many much-anticipated checks and balances to even out the playing field in real estate. Developers have been given space and incentives to adhere to their deadlines and steadily clean up a ‘dirty’ sector. They can now focus on completing under-construction projects and maintain transparency about allocation and usage of funds. Homebuyers on the other hand will have recourse to justice should developers continue to flout the rules.

RERA officials have led the way by ensuring timely approvals and granting registration numbers to projects. Maharashtra has been the standout state in this regard and has set an example for a RERA-fied real estate sector. Most of the other states are struggling to get their act together, however, some like Karnataka and Delhi have finally started issuing RERA approvals. As other state authorities take their cues from these frontrunners, homebuyers can expect timely project deliveries and developers can hope for better housing sector performance in 2018. On the flip side we can also expect to see many more litigations related to RERA in 2018 and for sure these verdicts will bring further clarity in the rules, as pertaining to various states.

Goods and Services Tax (GST)

GST was another long awaited regulation. Meant to replace a bunch of other taxes and streamline the rates on many goods and services across industries, GST shook up the economy. Since its implementation, various iterations were made to different rates. In the real estate sector, under-construction properties are being levied a GST rate of 12% while residential rentals are exempt from GST. Thus, GST brought confusion about application and led to increased prices and delayed possession. This proved to be counterproductive given the opposite effect of RERA. However, some developers took advantage of the situation to push sales of ready-to-move inventory by advertising the attractiveness of such properties sans GST. Moreover, developers are yet to benefit from accruals of input tax credit which can they can in turn, pass on to homebuyers. As this and further iterations happen to various rates in 2018, developers hope the GST rate comes down to stoke homebuyers’ interest in new construction purchase.

How does the GST impact your home buying decision
How does the GST impact your home buying decision (Image credit: Sundayguardianlive.com)

A Cleaner Sector?

Experts as well as critics are unanimous about the winds of change sweeping through the sector. The hope and expectation is that the changes are positive, enabling transparency about capital acquisition and allocation, faster approvals to developers, fewer construction delays and quicker possession for homebuyers. This in turn provides opportunities to developers – big and small – to adopt transparent practices and shed the notorious tag that has dogged the sector for decades. One can say with certainty that trust from customers is something the real estate sector has lacked. This is a big factor in any transaction. With these new regulations, as the grey areas start to fade away, there is hope that developers can begin to earn the trust of homebuyers.

Affordable Housing & PMAY

The Pradhan Mantri Awas Yojana was hailed as an enabler and a welcome government housing scheme. Under this scheme the government rolled out plans in rural as well as urban areas to enable more families to access affordable housing. Projects under this scheme picked up steam in 2017 and in the quarter ended September 2017, home sales increased 5% year on year in the top 8 property markets of the country powered by a 24% surge in affordable housing sales. Significant uptick of 11% was seen in the affordable segment with prices less than Rs 25 lakh. This is attributable to the fact that developers are realising the benefit of increasing supply in a category where demand is driven by financial and fiscal benefits under the ‘PMAY Housing for All’ subsidy scheme.

2018 will see further growth in this particular housing market as the government has approved construction of 112,083 more affordable homes under PMAY with an investment of Rs 8,105 crore. This means the total homes sanctioned under PMAY(Urban) has now gone up to 3,052,828. All of this is good news for developers looking to make a mark in this sector as well as for first home buyers looking for quality and affordable homes.

Indian and Japanese PMs at the laying of the foundation stone
Indian and Japanese PMs at the laying of the foundation stone (Source: The Guardian)

Infrastructure Developments

Across the major cities, huge investments were made in upgrading existing infrastructure as well as installing new ones. This includes expansion of metro projects in Delhi, Bengaluru and Mumbai while Hyderabad will see the launch of metro transport. Additional lines connecting distant suburbs will enhance connectivity and improve travel times and provide better commuter experiences. Simultaneously big ticket projects like the Delhi-Mumbai Industrial Corridor (DMIC), Dwarka Expressway (now provided National highway status), India’s first Bullet Train from Mumbai to Ahmedabad, and the new airports in Navi Mumbai and Jewar are aimed at boosting trade, infrastructure and standard of living across the country. Work on most of these will continue in 2018 and some like the Dwarka Expressway will be completed.

Overall, 2017 can be considered a busy year. It brought upheavals and yet signalled major changes and overhauls in the way the industry was operating. There can be opportunities in change and it is up to the major real estate companies to lead the way even as smaller companies are seen to be adapting quickly and eating into market share. For homebuyers this is a wait and watch period to observe how these changes unravel and what benefits it brings. They also need to focus more on doing their own due diligence and research, before making a decision. Public RERA portals provide access to information like never before thus enabling informed decisions. 2018 is definitely a year to watch out for in Indian real estate.

GST and Indian real estate – Tricky times for home buyers

How does the GST impact your home buying decision

If one had to describe the present time in a single word, it’s likely that this word would be ‘disruptive’. Across the world, the speed of technological innovations and ever-changing regulations mean that dealing with uncertainties is the new normal in any business. India, too, has seen the winds of disruptive change come by and the country, its economy and people cannot help but be affected by the same.

The Indian economy, in general, can be said to have had an action-packed last 12 months, with the twin disruptions of demonetization and the Goods and Services Tax (GST) sharply impacting economic activity. The country’s burgeoning real estate sector, which also had to deal with the Real Estate (Regulation & Development) Act (RERA) to deal with, is a good place to examine how these changes have actually played out at the ground level. In this article, we shall focus on the impact of the GST on this vast sector.

GST – The Intention

The GST is probably the biggest change the Indian taxation system has seen. It required a constitutional amendment and long, detailed discussions between the central and state Governments to see the light of day. The GST came with many laudable objectives, which include:

  1. Bringing the country under a single taxation system, thus promoting ease of doing business and removing price distortions.

  2. Bring about greater transparency in tax collections, resulting in greater tax compliance among businesses and hence, a boost to the country’s GDP.

  3. Elimination of the scourge of black money and a cleaner economy.

  4. The provision of tax credit on inputs removes multiple taxation of the same product and benefits producers, service providers and consumers alike by means of lower prices.

The GST was certainly conceived with good intentions. However, nearly 4 months after it came into effect, one can say that things haven’t quite turned out as was intended, based on our discussions with various real estate firms.

GST – How it has actually turned out for real estate

The real estate sector has seen what can be described as a partial implementation of GST. While GST is levied on under-construction properties at a rate of 12%, properties which have received their occupancy certificate (OC) are exempt from the same.

GST and real estate (Image credit: Housing.com)
GST and real estate (Image credit: Housing.com)

The GST was supposed to subsume various indirect taxes levied on purchase of property earlier, such as the Service Tax (4.5% of property price) and the Value Added Tax (VAT) (1% of property price). The difference between the GST rate of 12% and the old rate of 5.5% (service tax + VAT) was expected to be covered by input tax credit received by developers from their suppliers. However, other indirect taxes such as the Stamp Duty on land (around 5-7% of property price, depending on the state) and registration charges (approx. 1% of property price) were left out of the GST’s ambit.

The result is a GST, which still subjects this sector (which contributes around 9-10% to India’s GDP) to multiple taxation, but has additionally also burdened all parties with a larger tax component bringing down demand by pushing up property prices.

GST – End users are having a tough time

Finance Minister Arun Jaitley, head of the GST Council
Finance Minister Arun Jaitley, head of the GST Council (Image credit: Deccanchronicle.com)

For home buyers (particularly end users), the GST has been a double whammy. Not only has the price they need to pay for an apartment gone up, getting timely possession of their dream home too is affected. If one includes the Stamp Duty and registration charge to the GST, one finds that the tax burden on purchase of a home comes to nearly 18-20% as compared to approx. 11.5% earlier. For a home buyer looking to purchase a home for a base price of Rs. 50 lakhs, he/she now needs to pay Rs. 60 lakhs in total, instead of approx. Rs. 55-56 lakh earlier. This difference of Rs. 4-5 lakh is significant enough to deter a buyer, considering the current economic slowdown.

As GST is not levied on properties having an OC, many buyers are willing to postpone their home purchase till this stage to benefit from lower taxation. However, this has resulted in lower sales during the construction period and as a result, developers have limited cash flow for construction. This, in turn, is leading to delays in project delivery, which again affects end-users, who have to bear the cost of EMIs as well as pay rent for longer.

GST – Investors looking at other options

The other major class of home buyers i.e. investors too have not been spared. The greater tax burden on property purchases means a sharp increase in their transaction cost, which in turn, sharply brings down the returns they will get from future sale. As compared to investing in real estate, other asset classes such as equities (1%) and gold (2%) have much lower transaction costs for an investor and have become more attractive. As a result, fewer and fewer investors wish to get into property purchases, which further contribute to the slowdown in the sector.

GST – Developers struggling to deliver

If home buyers are struggling, the same is true of the developers, who are finding their financial position becoming increasingly stressed.  With sales coming down due to higher taxes, their hope of getting input tax credit on raw materials from suppliers hasn’t materialized either, due to lack of clarity on the GST. As a result, developers have had to transfer the entire tax burden on to customers, which as explained earlier, hasn’t helped matters.

In addition, with lower cash flow from property sales, developers are compelled to complete projects by borrowing funds. These have left the developers with increasing debt on their balance sheets, which in turn call for greater interest payments, imposing an additional cost on them. Delay in getting regulatory approvals has worsened the problems, with developers not able to advertise and attract customers till they get these approvals.

Also, the complex procedures of filing GST returns have increased the cost of compliance on developers, affecting their ability to deliver further. While developers have welcomed initiatives such as the RERA and demonetization which have brought greater transparency and trust in real estate, the current slowdown due to the GST is a major worry.

Time for fresh initiatives

Looking at the way things have panned out post-GST implementation, one can say that as things currently stand, the GST seems to have constricted rather than encouraged growth of the real estate sector. Considering this sector is one of the biggest contributors and employment generators of the Indian economy, this state of affairs should be a concern to the Government as well and some urgent initiatives are needed to put things back on track.

Recent news concerning the GST Council considering bringing real estate as a whole under the GST, instead of the piecemeal approach currently adopted, is definitely a positive. More such steps are needed to encourage growth in this sector, which affects everyone from developers, laborers, suppliers, the government and finally, the home buyers.

Era of Indian Real Estate Rejuvenation? Why We Can Be Optimistic…

Indian real estate

The last few months have been among the most eventful in Indian Real Estate sector. It began with the rollout of Real Estate (Regulations and Development) Act, popularly referred to as the RERA Act of 2016, across the country. Each state government has been involved ever since in the implementation of this Act in its own domain. Maharashtra has been the most proactive state thus far in the rigorous implementation of RERA. Hundreds of projects were registered under Maharashtra RERA as the process built to a fever pitch as the deadline of July 31st loomed. Officials with MahaRERA, particularly, have been supportive, progressive and proactive in ensuring the regulation is implemented with minimum hassle.

While this humongous process was underway, the Indian government implemented into law the progressive GST or Goods and Services Tax. The quick succession of these two laws means most real estate developers across India are busy taking stock of the impact on their operations, delivery of projects and customers and ultimately their sales and profit bottom lines.

A number of developers view these two landmark Acts positively, as they are set to usher in a more transparent and organized business environment within real estate as well as the larger industry. This augurs well for both the developers as well as the customers or home buyers.

Mumbai Skyline, Lower Parel: Indian Real Estate
Mumbai Skyline, Lower Parel

As a result, Indian real estate has never looked more attractive as a sector to home buyers and investors alike. A number of factors over this year, in addition to the latest Acts, have contributed in varying degrees to give the sector a positive outlook. Let’s take a look at some of these:

  • Reduction in home loan rates – The last one year has seen a consistent reduction in home loan rates making housing finance more accessible to a wider consumer base. Home loans are now available at a multi-year low of 8.50% to 8.25% based on the lending institution. With the RBI cutting the repo rate, banks are able to pass on the benefit to consumers with lower interest rates on home loans. As a result, more Indians are sensing an opportunity to purchase their first homes or an additional home.
  • Resumption In FDI flows – Prime Minister Narendra Modi promised greater ease of doing business in India. Changes in FDI norms was one of the big initiatives along these lines. Foreign Direct Investment in Indian real estate has long been a major challenge. Under the new FDI norms, many of these will be smoothed, paving the way for greater participation by foreign investors and funds, in the growth of construction in Indian realty. The new norms include clarity in entry and exit of foreign investors, transfer of ownership and stake as well as removal of lock-in period of investment.

    While these reforms certainly make investing in Indian real estate attractive, simultaneous structural reforms such as RERA and GST have added to the allure of a more liberalized FDI framework. The PM has been reaching out to NRIs during his numerous overseas trips. Since NRIs are among the biggest participants in FDI in real estate, this reform will imbue them with more confidence in the sector and enhance their quality financial participation.

  • Housing for All: PMAY & CLSS – Mr. Narendra Modi has a bold and ambitious vision to ensure every Indian owns a home by 2022, with affordable housing being a key focus area of the current government. Pradhan Mantri Awas Yojana and Credit Linked Subsidy Scheme are the two enablers towards this end launched under the ‘Housing for All’ scheme.
Raunak Group's Raunak Heights is an example of affordable housing: Indian Real Estate
Raunak Group’s Raunak Heights is an example of affordable housing

These two schemes will provide financial assistance to homebuyers from Lower Income Group (LIG) and Economically Weaker Sections (EWS) through lending institutions in the form of an interest subsidy on home loans. The scope of the scheme has been widened further to include citizens from the Middle Income Group as well such as those earning above Rs 6 lakh and up to Rs 18 lakh per annum. This ensures a wide population of new home buyers and a promising market for affordable housing.

  • Real Estate (Regulation & Development) Act or RERA – Seen as a watershed moment in the history of Indian real estate, RERA is expected to bring transparency and competitiveness in the real estate sector, which in turn will benefit both the customers and the developers. Only reputed players are expected to survive the increased scrutiny in a post-RERA business environment.
  • Enabling Infrastructure Projects – India is experiencing unprecedented growth, and infrastructure is a vital part of this growth. Various projects across the country are being undertaken. However, some of the most ambitious projects are being planned and executed in Mumbai. These include the DMIC – Delhi Mumbai Industrial Corridor, the new Navi Mumbai Airport, the 30 km coastal road connecting Marine Lines in South Mumbai to suburban Kandivali in the north, the Trans-Harbour Link Road from Sewri to Nhava Sheva port and additional metro lines across various parts of the city.
Indian real estate: Indian and Japanese PMs at the laying of the foundation stone: Indian Real Estate
Indian and Japanese PMs at the laying of the foundation stone (Source: The Guardian)

The newly inaugurated Bullet Train project connecting Mumbai to Ahmedabad as well as the numerous industrial centers of Vapi, Surat, Vadodara and more along the route, provide fresh impetus to industrial, real estate and employment growth. 

These highly anticipated infrastructural projects are expected to provide new impetus to the financial capital of the country – improving connectivity, decongesting existing transport infrastructure and enhancing the standard of living and make investing in real estate that much more attractive.

Indian Real Estate has long been the dark horse of the Indian economy despite being the better contributor to GDP as well as providing higher returns on investment as compared to other asset classes. Policy reforms, long-awaited regulations, and highly anticipated infrastructural projects will inject some much-needed shine to the sector.