real estate trends in 2016

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RBI has cut interest rates by 50 basis points in two rounds previous year.

The positive effect of this will be seen this year as buyers who are waiting for much deeper cuts will stop doing so and

seal the deal

Developers are changing track to attract buyers into the residential markets. Builders with large debts and piling

inventories are expected to ease the process of property investment with easy payment

plans for homes

The property in India has witnessed large unsold inventories, a majority of which is in

Tier I cities including Mumbai, Delhi, Hyderabad, Ahmedabad and Bangalore.

This has prompted most of the developers, both big and small, to head to other

upcoming tier II cities like Pune and Chennai.

The plan for 100 smart cities across India and other such projects similar to the GIFT city in Gujarat have already garnered huge interest

in the NRI and other communities. The government has also made it easier for FDI to

flow in to Smart City projects. Such flow of fund, it is expected to boost investment in the affordable segment, which will lead to growth

in the real estate sector

The change has already happened. A large number of developers are re-drawing their plans and are converting 2BHK apartments into 1BHK apartments in India with fewer and simpler amenities. This will end the

exclusive growth of luxury condominiums in all the new locations

The commercial office sector, which was a saving grace during the slowdown, is

expected to further shine in 2016. Buyouts of ready commercial space is on, and private

equity funds are now even looking at investing in under-construction properties

Several private equity (PE) funds are either planning or are already on their way to raise almost $4 billion from overseas

investors to invest in real estate in 2016

The real estate sector that suffered much pain in the past two years is moving towards a more rational regime where developers,

having learnt from their mistakes, now focus on project execution and delivery. 2016 is expected to gradually move towards better home sales and see a spurt in launches in

some locations

After more than three years of PE funds doing primarily debt and debt-structured transactions in real estate, a few of them are again ready

to infuse equity capital into projects to get better returns through long-term commitments

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