Year 2020 comes with hope of positive changes in India’s real estate sector. There are various reasons for these changes which the home buyers can expect in major property markets in India.
Property Prices May Move Up In Some Markets
In the slow market the price responsiveness was not seen in 2019, though in some marginal corrections were seen. Data shows that property value appreciated by 40% in Hyderabad in last Five years. The upward movement may persist in cities like Hyderabad, Bangalore and Mumbai. The price movement has not been so sharp in two and three tier cities in Delhi NCR. The home-buyers may see some corrections in Delhi NCR in 2020.This may be due to certain positive steps taken by Central and State Govt. to protect home buyers as well as imposing some stricter controls on builders through RERA (Real Estate Regulatory Authority).
Expecting Better Home Loan Deals from Banks
Central Bank has on several occasions has reduced the lending rate. In 2019 the lending rate was reduced by 135 basis points and may have dazzled the consumer but the rate transmission by bank has been shockingly slow. It is evident from the existing data that the difference between rates bank lend money from the Central Bank and the rate at which they lend it to consumers is highest since 2012. Banks are likely to bridge this gap in the coming year and buyers are expected to get loan at cheaper rates in 2020.
Reduction in Number of Banks
Due to merger of banks, the total number banks are set to reduce remarkably. Only the big banks will survive and entry of more number of non-banking financiers for catering to home-buyers a good reason for home buyers to believe housing finance could become more affordable in 2020.
Availability of More Housing Units
As a positive effect of implementing RERA, builders are now speeding up to complete their projects in hand, however the launch of new project plans have taken the backseat. If liquidity was an issue, genuine builders would find help from the government through its Rs 25,000 crore alternative asset fund. Therefore, in 2020 large numbers of housing units are expected to be handed over to home-buyers in 2020.
Some of the major project defaulters will be handed over to the state-run NBCC through Supreme Court order. This will bring relief to thousand of troubled home-buyers.
Positive Attitude towards Market Sentiment
As real estate authorities in states through their pro-buyer stance transform the market into a more consumer- centric one, buyer sentiments are set to get a boost in 2020. This would trigger fresh activity and owing to this, sales numbers might improve. Those willing to make a move in this market would certainly reap the benefits of low interest rates and high ready-to-move in housing stock.
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