Since a couple of previous quarters, the real estate market in India has been undergoing a period of huge change. How do you time your entry into any investment channel, be it stocks or real estate? Is it the crossroads when business sectors explode and everyone joins the fray? Does that settle for a good risk pick? Probably not!
Most retail finance specialists and homebuyers make this mistake. They buy when costs are peaking. Usually the profits are not as expected. I am right?
In fact, I am referring to the fundamental guideline of investing here. In case you are ready, I would like to clarify why 2018 should be the year you should enter the real estate market and be a proud owner.
Why is it a good time to invest in real estate?
A series of organizational reforms
The administrative changes executed through structures characterized by the Real Estate Regulatory Law (RERA) and the Goods and Services Tax (GST) to a certain extent, have promoted the division in a specific item.
It is mandatory that all real estate projects be inconsistent with the provisions of RERA, which strives to ensure that activities are carried out on time and that money paid by buyers for specific projects is not wasted for other purposes.
So, RERA secures the interests of the buyers. It will be unthinkable that there are temporary administrators in the market and only the most dedicated players will be able to explore the guide.
This will benefit both buyers and traders, in the long run.
It’s a buyer’s market.
The combination of oversupply, high prices and low consumption has resulted in huge stocks across the country. The consumption side was also affected by the interruption.
It’s obviously a buyer’s market right now, and for the next few quarters. But not by much!
With RERA in place, developers are now focused on completing their current projects. New home sales in eight Indian cities fell more than 75 percent in the third quarter of the current fiscal year, according to industry research reports.
The total number of launches is down by more than 40 percent in the first nine months of the current calendar year. These trends suggest that the supply side will gradually find some balance with demand, and prices will begin to rise.
However, in the current environment, there is a state of oversupply and property buyers are in a better position to bargain for a great deal.
According to industry reports, the National Capital Region (NCR) and the urban area of ?? Mumbai (MMR) has approximately 2 lakh units and 1.8 lakh units unsold respectively.
Interest rates on home loans are at an all-time low
Excess liquidity in the banking system has resulted in RBI being reapplied to key lending rates. As a result, interest rates on home loans, which were recorded at about 9.5 percent per year in 2016, are now in the range of 8.3 to 8.4 percent.
That generates big savings on EMI costs; empower people to benefit from the ease of homecoming and become mortgage holders.
It is normal for mortgage loan rates to remain low during the following quarters and may even drop further.
Given normal annual rental yields of 5 to 6 percent, there isn’t much of a contrast between the costs of renting and owning a home.
A steady resurgence of interest from the global investment fraternity
The execution of general administrative instruments has imparted a much higher amount of confidence in the world speculative organization.
The land area is expected to garner private equity (PE) speculation to the tune of US$4 billion during this financial year, according to industry reports.
Not only are PE shops from the US, Canada and Singapore busy mixing capital in the section, but countries such as Japan, China, Qatar, Hong Kong and the Netherlands are also willing to invest resources in the division.
Meanwhile, sovereign wealth holders around the world who are generally known for their traditionalist and risk-averse approach have been expanding their presence in the market and it shows that the party is on the right track.
With regard to property buyers, it is an indication of restoration in the cards. In general, the current condition shows the opportunity to buy a property and make the most of the next year.