India’s realty arena has been surging at a fierce rate as of late. After being suppressed for long, real estate has shown signs of revival in many parts of the country. Though in short term, results will be difficult to comprehend but the medium and long term surely seems positive. If Fitch, the all important global rating agency is to be believed then 2016 will be the year of real estate in our great nation.
The reduction in home loan interest rates by most commercial banks and NBFCs along with an upward surge and positive sentiments in country’s investment scenario, are all set to break the gloomy mood. As a result, Indian real estate is all set to bounce back till March 2016 thus providing some much needed relief to debt laden realty developers. The real estate development sector is all set to benefit the most from the home loan rate cuts as more credit generation will prompt people to buy their dream home or invest in a high return on investment yielding property.
RBI, the apex bank of India, had significantly reduced its repo rate by a humungous 50 basis points from January 2015 onwards. RBI issued an ultimatum of sorts to the banks to follow suit soon, post which the banks slashed their rates. 9.9% has kind of become the norm as far as home loan rates are concerned. Fitch also rightfully pointed out the rate cuts will benefit those developers more whose target customer base comprises of people pertaining to lower and middle income groups. Developers targeting high income customers will not be at the receiving end of benefits though.
According to Fitch, India is also poised for massive growth in the years 2015 and 2016. India’s Gross Domestic Product (GDP) is highly likely to grow at a whopping 8% in this financial year and a staggering 8.3% in the next. As the nation expands, its realty space will grow along with it.
The year 2014 wasn’t good for real estate by any means. Political uncertainty and high home loan lending rates marred the sales of the struggling sector. The developers however responded by introducing immensely lucrative payment plans which required the clients to pay only a meager amount at the time of booking and the balance at a later stage. This adversely impacted the balance sheets of developers and will continue to do so in the very near future as well.
But the Indian economy and India’s realty space is on the verge of improving and expanding. 2015 and 2016 will surely mark the comeback of both. So the world believes in the India growth story, then what are you waiting for? Explore the real estate arena of India today and buy your dream home without wasting another second or invest your hard earned money into a return yielding property today. You won’t be disappointed for sure but will only keep coming back for more, period.