India’s Realty Still Suffering from the Buyer Sentiment
Nov 05, 2019 Real Estate News
The slowdown of the demand in the real estate market of the country has led to a reasonable deduction in the prices of the property across the country. Barring few exceptions, the rates have been the same for most of the property market.
The repo rate deduction has defiantly cheered the banks and the loan lending financial institutes. At 5.15 percent, the repo rate is the lowest it has been this decade. The loan lending rates offered by the banks have reduced which is expected to hike the demand in the real estate sector.
Investing in the affordable segment, i.e., property costing Rs 45 lacs and below, will surely reduce the cost of the property. Earlier the tax deduction on the interest paid on the property purchase was Rs 2 lacs. In this year’s budget, the limit of a tax deduction was increased from Rs 2 lacs to Ra 3.5 lacs.
According to the data, there are over 8 lacs unsold units lying with the developers and the builders are now looking for ways to sell off the unsold inventory. The builders have to deal with added tax burden if they fail to sell the unit within the specified time.
The buyers today are financially in the position to afford the property that they would not have been able to afford in the past. Thanks to the financial banks and the institutes that are ready to lend out the loan to the borrower. The buyer only has to pay the 20 percent the amount of the property and the rest is taken care of by the bank.
Lack of interest among the buyers
According to the reports, the lack of interest among the buyers is due to the many cases of insolvency pending with the government. The past attitude of the builders and the delay in the completion of the project are the major reason why buyers are hesitating from investing in real estate. The trust issue is the reason that is avoiding getting in real estate even though the government is making efforts to revive the industry.
How to make the most of the situation
Over the last few years, a lot of rules, laws, and efforts have been introduced by the government to make the real estate sector more lucrative and reliable. The subdue in the demand has changed the way the real estate moguls work now.
The developers are now ready to negotiate the reasonable price and with the stringent laws in place, there’s very little room for them to play the buyer. Genuine sellers are ready to sell the property as soon as they, given the buyer is genuine too.
However, one should remember that even though the market is slow, there’s one up to a certain limit a developer can offer the discount. If the property is coming with a hefty discount then it should raise a red flag and the buyer should stay away from any such deal.
The repo rate deduction has defiantly cheered the banks and the loan lending financial institutes. At 5.15 percent, the repo rate is the lowest it has been this decade. The loan lending rates offered by the banks have reduced which is expected to hike the demand in the real estate sector.
Investing in the affordable segment, i.e., property costing Rs 45 lacs and below, will surely reduce the cost of the property. Earlier the tax deduction on the interest paid on the property purchase was Rs 2 lacs. In this year’s budget, the limit of a tax deduction was increased from Rs 2 lacs to Ra 3.5 lacs.
According to the data, there are over 8 lacs unsold units lying with the developers and the builders are now looking for ways to sell off the unsold inventory. The builders have to deal with added tax burden if they fail to sell the unit within the specified time.
The buyers today are financially in the position to afford the property that they would not have been able to afford in the past. Thanks to the financial banks and the institutes that are ready to lend out the loan to the borrower. The buyer only has to pay the 20 percent the amount of the property and the rest is taken care of by the bank.
Lack of interest among the buyers
According to the reports, the lack of interest among the buyers is due to the many cases of insolvency pending with the government. The past attitude of the builders and the delay in the completion of the project are the major reason why buyers are hesitating from investing in real estate. The trust issue is the reason that is avoiding getting in real estate even though the government is making efforts to revive the industry.
How to make the most of the situation
Over the last few years, a lot of rules, laws, and efforts have been introduced by the government to make the real estate sector more lucrative and reliable. The subdue in the demand has changed the way the real estate moguls work now.
The developers are now ready to negotiate the reasonable price and with the stringent laws in place, there’s very little room for them to play the buyer. Genuine sellers are ready to sell the property as soon as they, given the buyer is genuine too.
However, one should remember that even though the market is slow, there’s one up to a certain limit a developer can offer the discount. If the property is coming with a hefty discount then it should raise a red flag and the buyer should stay away from any such deal.
