Construction for 4.9 million units has begun and 2.6 million units of which have been completed. Given the past trend, additional 1.64 million houses are likely to be sanctioned by December 2019, making it highly possible to achieve the 10 million houses target by 2022. Projected subsidy disbursement over next 3 year for the same is projected to INR 1 trillion.
ANAROCK research indicates that out of the total new supply in H1 2019 – approx. 1,39,480 units in the top 7 cities – over 53% (73,930 units) were launched by branded developers, and 47% by non-branded entities. In H1 2018, branded developers’ share was 52% and during H1 2016 – before DeMo and RERA – non-branded developers had a 60% share (approx. 95,600 units) of the total of 1,59,090 newly-launched units in the top 7 cities. Branded developers accounted for 63,490 units (40%) of the total supply in the period.
As anticipated, residential real estate activity remained largely tepid during the second quarter of 2019 in the backdrop of the general elections during the period but the recent Union Budget sops for the affordable sector may give the much-needed push to the segment henceforth. ANAROCK research indicates that housing sales in Q2 2019 fell by 13% q-o-q and stood at 68,600 units across the top 7 cities.
Only a paltry number of developers have built housing that meets the Government’s criteria for incentivized affordable housing in 2019. ANAROCK data reveals that of the total housing supply of 1,39,490 units in the top 7 cities H1 2019, merely 39,840 units meet these criteria. The Government’s recent Budget ‘bonanza’ of an additional INR 1.5 lakh tax deduction on interest repayment of home loans availed till March 2020 will benefit very few people in urban India.
Without compromising on fiscal prudence, the Finance Ministry will have to present a budget that is not only inclusive but also assures growth across industries. It clearly shoulders a considerable share of responsibility for retaining India’s position as the fastest-growing economy.
The slowdown in Indian residential real estate over the last few years caused most high net-worth individuals (HNIs) to shun luxury housing and look at other investments within or outside real estate. However, ANAROCK’s latest study indicates that HNIs are now using the tail end of the slowdown in India’s luxury residential market to their advantage.
Jhumur Ghosh welcomed the panelists, following which Ravi Sinha questioned the global competitiveness of Indian real estate in the wake of thousands of abandoned projects waiting for the funds, the debt-equity ratio imbalance, lending issues, pre-launches without RERA sanctions, and the developers’ defending the indefensible.
Can Indian real estate bridge the gap between the promise and the performance? Can Indian residential market attract as much investment as its commercial real estate? Will the global funds trust the Indian residential real estate? There are more questions than ever and it is time to settle these question marks over the business of real estate.
According to a World Bank report, India received USD 79 billion in remittances in 2018 – with a sizeable portion going into real estate. NRI investments into Indian real estate are led Indian expatriates from UAE, USA, UK, and Canada. In terms of Indian cities, Bengaluru, Mumbai, Pune, Hyderabad, Chennai and Delhi-NCR currently attract the lion’s share of NRI investments.
Once completed, Jewar International Airport will not only ease traffic at Delhi’s IGI Airport but also create multiple job opportunities and give decent impetus to the property market in Noida, Greater Noida and Yamuna Expressway. These markets have been reeling under tremendous pressure over the last three to four years, and require a fresh injection of opportunity and intent to overcome this slump.