Homes to get cheaper, know why | Fusion - WeRIndia

In India, the real estate sector has been decreasing significantly in recent times.

Last year, the residential real estate prices fell because of demonetization and the implementation of both the Real Estate Regulation Act (RERA) and the Goods and Services Tax (GST). As a result, buyers will get homes at cheaper rates.

Real estate prices in the National Capital Region (NCR) had already been falling over the last six years, but in 2017, they dropped another 2% on average.

Across cities in the country, real estate prices fell by an average of 3%. Pune had the highest decline of real estate prices, at 7%, and Mumbai had the second-highest decline of real estate prices, at 5%.

Due to the RERA, the GST, and demonetization, there has been a sharp decrease in demand in the real estate sector.

Thus, real estate prices have also fallen sharply. Sales in Bengaluru fell by 26%, sales in NCR Delhi fell by 6%, and sales in Chennai fell by 20%.

However, since RERA was properly implemented in Maharashtra, real estate sales in Mumbai and Pune both received increases. Mumbai’s real estate sales increased by 3% and Pune’s real estate sales increased by 5%.

Yet, overall, the real estate sector has been severely hurt by this decline in demand. During the New Year, launches witnessed an unexpected slowdown, due to these slow sales.

In NCR Delhi, new launches fell by 56%, and in Bengaluru, new launches fell by 41%. The share of affordable homes among the new launches rose from 2016 to 2017.

In 2016, the share was 53%, and in 2017, the share was 83%, which showed the focus of developers on properties within the ₹50 lakh price bracket.

However, real estate activity has now shrunk to a fraction of its size in 2010, and this has happened in less than a decade.

Yet RERA seems to be improving the real estate sector in the places where it has been properly implemented, so the sector may rise back up in the near future.

Image credit: Photo by Stephen Leonardi on Unsplash (Free for commercial use)

Image Reference: https://unsplash.com/photos/Al9Cl-b7EFU