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In 2017, a number of policies were integrated into the Real Estate in India. This slowed down the business to a certain extent, but it brought about greater transparency in the industry. The inception of RERA and GST, following the demonetisation in 2016, created pressure on the corrupt developers and brokers. As a result, the business environment has been refined and the confidence among homeowners is reviving fast. Along with these, the affordable housing policies came to the scene, which enables middle and lower income groups to acquire property through easy home loans. In most of the cities, people can now purchase reasonably-priced properties.
Well, it is time to have a look at the contemporary trends of housing in India:
Office asset class
Throughout 2017, the levels of vacancy remained mostly unchanged. It was around 14% across the country. In certain markets, the vacancy levels were lower, and are likely to further go down in 2018. The overall levels of vacancy will be around 15% in 2018. Rental appreciation in 2018 is likely to get a boost due to continued demand and low rates of vacancy in the leading cities like Pune, Hyderabad, Bangalore, and Gurgaon. In these markets, the rents are likely to rise up to 6-8% based on year on year basis.
The 2017 trends in the real estate industry reveal that the retail market prices have undergone changes. The year 2017 was the second-best year in terms of net absorption after 2011. The stocks of shopping malls are projected to grow in the next three to four years. In 2018, 11 million square foot area is likely to come up in the retail market. At present, most of the stocks are concentrated in the major cities including Mumbai, Bangalore, and the NCR region.
Considering residential housing, 2017 was one of the most unfavourable years for the developers. They faced a number of challenges like RERA policies, GST and other stringent policies undertaken by the government. In 2018, the situation is likely to change, in favour of the real estate industry.
With more transparency in the industry, the probable 2018 real estate conditions are likely to be favourable to the homeowners.
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