The Current Real Estate in India and Its Future Prospects
- # buy property in India
- # buying a home
- # indian real estate
- # Indian Real Estate Sector
- # real estate in Mumbai
It will be an understatement to say COVID-19 has jolted the entire economy. Ever since the novel coronavirus has made its way to the Indian borders, the real estate in Mumbai, like every other industry in the country, suffered a major blow. The sector, which was rapidly growing, faced a decline as real estate operations and constructions were put on a halt.
Also, with companies shutting down, people getting expelled from their jobs and businesses suffering losses, there was a significant drop in the purchasing power of buyers and investors. For a while, it seemed that all the grand infrastructural development plans that the country had for its metropolitan capital were going to fall apart. However, well-placed and timed precautions and strict measures ensured that things didn’t get any worse.
Is Real Estate Investment Profitable in India Now? Why?
The above-mentioned facts paint a bleak picture of Indian real estate. However, there’s a silver lining to it as well. The real estate sector can still prove to be profitable in India for those who are seeking opportunities.
With construction work and other businesses reopening in phases and the lockdown being lifted, people are hopeful that the real estate sector will gather momentum in the time to come. It is an opportunity for investors to buy ready projects now and sell them once the sector gains normalcy. New investors who are looking to enter the market can make use of this opportunity. Seasoned investors, too, can avail it to add properties to their growing portfolio and diversify it.
The enhanced flexibility shown by sellers/developers has provided people looking to buy a residential property with a lucrative opportunity as well. Those who have surplus money or a stable income can make use of this chance and turn their dream to become a homeowner into reality.
Indian Real Estate – The New Hotspot for Foreign and NRI Investments
NRIs, in particular, are preferring to buy property in India as they hope to return to their homeland at some point in time. Needless to say, the lucrative ROIs are enough to make anyone realize the significance of the opportunity that’s available.
The INR deprecation factor is also credited for the increased interest shown by NRIs to invest in India. This can help the revival of the sector amidst the global pandemic if developers take timely action and address the demand of NRIs and foreign investors.
The changing preference of international brands is another major reason that has led to India grabbing more interest from foreign investors. Earlier, these brands favoured China for production and manufacturing plans. However, now, India has emerged as their preferred choice.
The impact of this shift of interest is expected to be visible in numerous sectors. Reports suggest that NRI investments in India for the financial year 2021 is expected to touch the record-breaking figure of $13.1 billion. The formation of RERA, too, has supported the interest of foreign investors. It reduces the risk of scams and provides them with a clearer picture of proceedings.
Future of Real Estate in India
Apart from property investment in Mumbai, the interest of investors, foreign and local, is shifting to other metropolises as well. However, this doesn’t mean that Mumbai lags behind in terms of real estate investment. As a matter of fact, it is key to the Indian estate sector, with new developments being launched in every part of the city. Not only that, but adjoining areas such as Thane is also gaining prominence.
Given the fact that infrastructural development projects such as the Metro lines and the Harbour Link of the MMR are set to change the overall state of the region, the future is sure to turn this catastrophe around. Not only will this improve the environmental state of the region but it will also mean notable progress for the underdeveloped slums in Maharashtra. This will connect major points of the city with the addition of a trans-harbour link to reduce pollution and lessen the time taken for transportation.
Shedding light on the future of the real estate sector in India, experts believe that recovery is on its way. Marginal improvement has been noticed in the sector due to the reliefs offered by RBI and the government. Some states have already reported an increase in sales in comparison to the period between March and June. Having said that, it is still believed that the need of the hour is to take holistic approaches, with a sole aim to boost demand for real estate investment.
Due to COVID-19, a lot of people have realized the importance of having their own home instead of living in rental properties. As per experts, the mid-range and affordable segments of the real estate sector will be the first ones to witness the signs of revival. Furthermore, it is expected that Bengaluru and Chennai’s southern markets will also show indications of recovery.
With low property rates, GST exemption and lowered stamp duty along with reduced home loan rates, it is speculated that ready homes will be the top priority of people in Maharashtra. Other than that, off-plan properties that are due to be completed in the next 6 to 7 months are also gaining interest. There is no GST exemption but their reduced pricing is the reason they are expected to sell out quickly.
The Changing Norms
Although the trend of virtual tours existed before COVID-19, it gained more prominence during the lockdown. It allowed interested buyers and investors to take a glimpse at any property in Mumbai without having to leave their home. Many top developers such as Piramal Realty now provide virtual tours and 3D walkthroughs to interested parties via their website and social media pages. It is not only helpful in the prevalent conditions to negate the risk of virus spread, but it also saves time and effort as one can decide whether they want to buy a property or not, without visiting it for inspection purposes.
All in all, due to the expectations of a high ROI and incentives offered in various states, it is safe to say that it’s the right time to invest in the real estate market. Since it’s a long-term investment that will take time to return profits, the pandemic crisis and the damages inflicted by it will subside and future infrastructural developments will rise to paint a better picture.