After the demonetization, in the second quarter, the residential sales of top 8 cities have increased by 6% consecutively and the total growth is around 28%
Post demonetization, the government introduced some schemes to eliminate black money from the country and maintain the user & demand of real estate sector, one of them schemes includes, interest subvention on affordable housing, which successfully resulted in better sales in the top 8 cities of the country. At present, affordable housing introduced by the government is playing a major role in the sector and its growth.
According to reports, the residential sales of country’s top 8 cities have increased by 6% that too consecutively in the second quarter after the demonetization. However, the total growth is around 28%.
After the implementation of The Real Estate (Regulation and Development) Act, 2016 and goods and service tax (GST), the sales were increased by 4 % during the quarter.
Affordable housing has also led the residential sales a step ahead even after demonetization. The sales during the first half ended June of the top 8 cities are down by 11%, however, if we compare with July-December, 2016 period that was affected by demonetization, the sales have still risen up comparatively.
In tier I cities, the overall sales approached by 24 of the highest sales figure and the third best performance of the region in last seven years.
Pradhan Mantri Awas Yojna was introduced by Prime Minister Narendra Modi, which introduced government’s decision that it will provide interest subvention of 3% and 4% for loans of up to 12 lakh and Rs 9 lakh, respectively. Affordable housing demand clearly shows up by the number of loans led by banks to people.
Home buyers are buying houses as the interest rates are lower and property prices have not moved up for long, which is the result of incentives provided by the government. The new launches are slow as of now, which is improving sales with the easing of supply numbers.
Quarter from 47 months in the previous quarter, inventory levels across tier I cities decreased to 44 months that is on the June but it still remains far away from the desired 8-10 months market inventory.
In the previous quarter, properties priced below 25 lakh across the eight cities contributed to 17% of overall sales compared with 16% and the maximum sales.