If you have real estate for sale in India, you will find the information given here very useful. Here are the top 3 news relevant to the Indian property market as of December 2015.
India Eases Real Estate Regulations with New Law
In a landmark move which should benefit people of Indian origin living in the UK, US and elsewhere, the Indian government has eased real estate regulations in the country considerably by approving a new Real Estate Bill. This should make real estate transactions in the country more transparent and consumer friendly.
The new bill bans real estate developers from changing plans without the consent of buyers. It now needs to be passed by parliament before it becomes an act and can come into effect. For decades, people of Indian origin living in the UK have been discouraged by the lack of regulation and transparency in the Indian property market. The new law should make things easier.
Samantak Das, the chief economist at Knight Frank India says, “If the consumer is protected to this extent and the real estate sector is made transparent in terms of all that is there in the regulation bill, definitely India will be extremely, extremely attractive for all consumers, either Indians staying in India or Indians abroad.”
“If India can bring in this type of regulation, not only at a central but also at a state level, I’m sure that NRIs [non-resident Indians] staying in the Gulf would look at India in a much more confident way,” Mr. Das added.
Fitch Expects Residential Property Prices in India to Remain Positive in 2016
Fitch Ratings expects residential property prices in India to remain stable in 2016 in a report titled “Outlook 2016: Indian Home builders”. According to the report, “Residential property prices should remain resilient in 2016, supported by improving demand. Home builders have been reluctant to reduce prices, and have instead used easy-payment schemes to woo buyers."
So, there is an expectation that easing interest rates, improvement in the economic scenario coupled and a better product configuration will help boost real estate sales in India towards the second half of 2016. Fitch Ratings expects pre-sales to improve by 5-10% over the next 12 months and for the average sales price of luxury properties in India to increase by 13%.
How Buyers Have Been Priced Out of the Mumbai Property Market
Mumbai is the richest and most expensive city in India, where real estate prices are as high as those in Hong Kong and Singapore. Mumbai is home to Bollywood and some of India’s biggest companies. Every year, thousands of properties worth millions of dollars exchange hands in Mumbai.
But the real estate market in Mumbai is one that is dominated by the ultra rich. There isn’t much in it for the middle class to get excited about. As Vivek Talwar, a real estate investor says, "These are one-off deals by billionaires who can afford it, there is no depth in the market. For most people, the cost of real estate is unrealistic, compared to what they earn."
Most Indians have been priced out of the Mumbai property market. As a result, it has become extremely difficult for real estate developers to sell apartments in Mumbai, even those that are targeted at the middle income group. Many developers offer freebies such as free parking and foreign holidays to attract buyers, but it doesn’t seem to have worked.
Indeed, apart from apartments in the in far flung suburbs of Mumbai that fall in the range of $45,000-$65,000 that are selling well, the sales scenario is pretty desperate for developers. Buyers are not buying and sellers are not helping matters by refusing to slash prices.