Real estate index gains due to the increment of sales volume

By : 360 Realtors

15 July, 2019

Nobody had thought that real estate stocks would lead to great returns in 2019. Half of the year is almost gone and till now, the Nifty Realty index has already delivered 19% returns. So far, it has turned out to be the biggest gainer among the sectoral indexes of NSE in the current calendar year. A 6% growth has been recorded in the Nifty 500 index this year.

Most of the investors did not consider that real estate could be having a good time ahead. After September 2018, the liquidity crunch hit the market. This further delayed the chances for the real estate market in India to recover. However, the realty sector has shown resilience, and the RERA Real Estate (Regulation and Development) Act is largely responsible for this.

 The real estate sector was once unorganized. Presently, it is gaining transparency and legitimacy. The sector has been much more organized and the real estate developers are coming up with a greater number of projects under the legislation. A sharp rise has been noticed in the new launches, being made under the guidelines of RERA. This has led to a rapid increment in the volume of sales. A strong improvement has also been noted in the pre-sales in various areas in the country. In the Financial Year 2019, the volume of sales has increased by 7%, as compared to the previous year, according to analysts. Along with the decline of launches of new properties, this has helped in selling off the accumulated inventory.

Improvement in the momentum of sales and decline in launches have led to a slash in the inventory. Statistics reveal that across the country, the inventory has decreased by 11%. Along with these, the repo rate has been reduced. As a result, 75 basis points have been reduced since last August. This is also expected to bring some relief to the real estate sector. However, some of the companies dealing with housing finance are still facing problems. These are mainly associated with the liquidity crisis. However, the business prospects in the real estate sector look better, as compared to the previous year.

It is also important to take a note of the stocks in the index of Nifty Realty, that are performing well in the present year. The valuations have also increased correspondingly, and they have turned out to be more expensive. The leading real estate companies are delivering high returns, and investors are keen to put their money on these high-value yielding stocks. The overall condition of the real estate industry is improving. The sales figures are also rising in most of the key cities in India. For investors in real estate, this is the right time to make the move. Investors can benefit from the high returns in real estate in the coming years.

Nobody had thought that real estate stocks would lead to great returns in 2019. Half of the year is almost gone and till now, the Nifty Realty index has already delivered 19% returns. So far, it has turned out to be the biggest gainer among the sectoral indexes of NSE in the current calendar year. A 6% growth has been recorded in the Nifty 500 index this year.

Most of the investors did not consider that real estate could be having a good time ahead. After September 2018, the liquidity crunch hit the market. This further delayed the chances for the real estate market in India to recover. However, the realty sector has shown resilience, and the RERA Real Estate (Regulation and Development) Act is largely responsible for this.

 The real estate sector was once unorganized. Presently, it is gaining transparency and legitimacy. The sector has been much more organized and the real estate developers are coming up with a greater number of projects under the legislation. A sharp rise has been noticed in the new launches, being made under the guidelines of RERA. This has led to a rapid increment in the volume of sales. A strong improvement has also been noted in the pre-sales in various areas in the country. In the Financial Year 2019, the volume of sales has increased by 7%, as compared to the previous year, according to analysts. Along with the decline of launches of new properties, this has helped in selling off the accumulated inventory.

Improvement in the momentum of sales and decline in launches have led to a slash in the inventory. Statistics reveal that across the country, the inventory has decreased by 11%. Along with these, the repo rate has been reduced. As a result, 75 basis points have been reduced since last August. This is also expected to bring some relief to the real estate sector. However, some of the companies dealing with housing finance are still facing problems. These are mainly associated with the liquidity crisis. However, the business prospects in the real estate sector look better, as compared to the previous year.

It is also important to take a note of the stocks in the index of Nifty Realty, that are performing well in the present year. The valuations have also increased correspondingly, and they have turned out to be more expensive. The leading real estate companies are delivering high returns, and investors are keen to put their money on these high-value yielding stocks. The overall condition of the real estate industry is improving. The sales figures are also rising in most of the key cities in India. For investors in real estate, this is the right time to make the move. Investors can benefit from the high returns in real estate in the coming years.