India’s real estate sector, which includes the housing, retail, hospitality, and commercial sub-sectors, is one of the largest contributors to jobs in the country.
According to a recent press release by Confederation of Real Estate Developers Association of India (CREDAI), the real estate sector in India has been witnessing steady growth over the past few years. Despite all the ups and downs, it has emerged as one of the leading industries in India, more so in Karnataka. Senior leaders from CREDAI Karnataka and CREDAI discussed factors that contribute towards the growth of the sector as well as the demands and issues faced.
Karnataka, one of the hotspots for real estate development, has seen an increase in demand from potential home buyers and investors, and is expected to witness a further boom in the sector by 2020.
The way ahead for growth in the sector
According to the release, an initiative by the government to reduce GST on affordable housing to 1 percent and on under-construction properties to five percent has helped the sector. However, the GST on construction materials is yet to be reduced. GST on cement and steel is 28 percent, which increases the construction cost. The reduction in stamp duty will also help in more demand and investment in the property in Bangalore.
CREDAI has already requested the central government for the reduction and is hopeful that the request will be taken into serious consideration at the earliest.
Speaking about the Bengaluru realty market, Kishore Jain, President, CREDAI Bengaluru, said, “Sarjapur Road, Hoskote, Kanakapura Road, Mysore Road, and Whitefield are the major markets for affordable housing in Bengaluru. We are receiving a positive response from buyers for projects under the Rs 45 lakh category. With the government’s intention of easing the policy, we want to contribute to the housing for all by 2022 programme.”
The release also stated that getting funding for this sector was a hassle. The lack of financial support from banks leads many real estate developers to seek NBDC funding. Highlighting the investment from the NRIs and HNIs, R Nagaraj, Vice President, CREDAI National said,
IT, ITeS, and startup sectors are bringing in more real estate business to the state and country. In the last three months, approximately Rs 46,000 crore investment has been made in the stock market by foreign investors. With this, Karnataka, especially Bengaluru, will see more investment in the near future from NRIs.”
The CREDAI has also requested for plan sanction and approvals within a specific time limit to improve the project speed, which usually takes four to eight months.
Talking about real estate trends, Adarsh Narahari, Chairman, PR and Media Committee, said,
Co-working, co-living and senior living are emerging as the latest trends in the real estate sector. Today, in Bengaluru, we are seeing a whole new group of people interested in rental homes with services. This can only mean that the sector is bound to grow as it caters to these new and emerging needs.”
CREDAI Bengaluru is an apex body of credible real estate developers, operational in Bengaluru
for three decades. It has around 250 reputed developers as its members in the city and 500+ developers across the state.