With Indians giving greater political strength to Prime Minister Narendra Modi for the next five years, there are high hopes that among the many reforms (of the past and to be introduced in the second term) some will finally make the grade, or at least, sow the seeds of change for future governments to follow.
As evident, the government had already set the stage for the real estate sector to flourish in the long term during the first five years that saw major policy overhauls (demonetisation, RERA and GST), amendments in old acts such as the Insolvency and Bankruptcy Code and the Benami Transactions (Prohibition) Act, increased impetus to infrastructure growth, and initiatives like Housing for All by 2022, 100 Smart Cities, AMRUT, etc.
Another obstruction in achieving faster real estate growth is the project approval process. In continuation of its efforts to ease the process, there are likely to be more such announcements in due course. After all, it will help the government address one of the major issues of the real estate sector — delayed projects.
Despite the right intentions, many of these initiatives are still to reach their fruition, but they may finally see the light under Modi 2.0. We also expect steady momentum in real estate, provided the government addresses its underlying concerns and sees a slew of new measures and reforms being introduced to further accelerate the sector.
Land reforms
Land — the very foundation of any development including housing, infrastructure or even manufacturing — could see major policy overhauls in due course of time. Lack of clarity in land titles is a major bottleneck in real estate growth. So the government could effectively unleash new policies including digitisation of land records via effective use of technology.
Streamlining project approval processes
Another obstruction in achieving faster real estate growth is the project approval process. In continuation of its efforts to ease the process, there are likely to be more such announcements in due course. After all, it will help the government address one of the major issues of the real estate sector — delayed projects.
Amendments in GST rates
Since its enforcement in 2017, several changes have been implemented to make GST more viable and both consumer- and business-friendly. Thus, there is a high possibility that the government may further ease norms to benefit all.
Sound rental housing policy
With rapid urbanisation and major influx of migrants across cities, the middle income group, lower income group and economically weaker sections are forced to stay in sub-standard areas due to non-affordability of home ownership. Hinting earlier about a sound rental policy across the country, the government is likely to make some major announcements. A sound rental policy will effectively aid the government in achieving its vision of providing housing to all.
Policies favouring affordable housing
In order to fulfil its vision of providing Housing to All by 2022, the government may introduce more policies favouring its rapid development. It must introduce stringent measures including releasing of government-held land, using seized benami properties for providing affordable housing, giving incentives to developers to participate in this segment, employing PPP model and using new-age construction technology to build homes faster.
Uniformity and nation-wide implementation of RERA is a must for the sector to do well and thus achieve growth. Therefore, it is imperative that the government takes stringent measures to now fully make it a single force across states.
INDIAN CITIES TO WATCH OUT FOR IN 2019
The Indian residential sector is riding on a new wave of optimism since early 2019 and is likely to continue, especially since a stable government is back in power.
Top cities that are likely to ride high include Pune, Bengaluru, Hyderabad and Mumbai Metropolitan Region (MMR). IT/ITeS sectors will continue to drive growth in the first three cities where property prices continue to be relatively affordable.
Being the financial capital of the country, the biggest draw for MMR continues to be the large number of industries, IT-ITeS and BFSI/Banking sectors. In terms of smaller towns and cities, Lucknow, Ahmedabad and Jaipur are likely to see decent residential growth.
Several new infrastructure projects including metro connectively and Expressways have upped their realty prospects.
— The writer is CEO, GCC (Middle East), Anarock Property Consultants
