2016 as the best year in this decade to Invest in real estate for both investment and home buying purposes
With the downfall in the real estate market, most of the builders are smart enough to sense the losses. Resultantly, while many builders have put a stay on their project with the hopes for revival of the market, others are reluctant to sell off the build projects. However, like said ‘one man’s tear is another man’s joy’, similarly, the downfall in the market has certainly become the golden opportunity for the home buyers and investors.
India is a nation which has a very high percentage of aspiring home buyers as owing a property is a matter of pride and a dream for everyone. However, owing to the annoying delays in the construction projects, the past few years had witnessed a slowdown in the home sales. The substantial delay was caused due to the bulk in demand vis-a-vis the stagnancy in supply, following the lack of any authority to look forward to. However, certain development and introduction of policies have worked together to turn as the best year of the decade to invest in real estate for investment and home buying purposes.
The key development luring investments and home buyers are as below:
Announcement of Smart Cities Mission: With government announcing its ‘Smart Cities Mission’ in January 2016, it provided a list of 20 cities. The list further made it easy for the prospective investors or home buyers to select and choose from the cities for the investment. The list also hints at the upcoming development in the real estate sector and its subsequent growth. Therefore, with the list in place is becomes essential for the investors and home buyers to grab the opportunity to benefit the most.
Introduction of Real Estate Act: The long awaited reform was introduced at the time when there was a major need of regulation of transactions between the buyers and sellers. With the act laying some solid foundation for building and implementation of what the consumers want; it has also encouraged many home buyers to park their money in real estate. It has ultimately paved the way towards matching the demand and the supply gap in the sector along with bringing back the lost confidence of the customer in real estate.
Providing additional deduction for first home buyers: The introduction of additional deduction of Rs 50,000 for the first home buyers, in Union Budget 2016-17 by Finance Minister Arun Jaitley, further gave an added reason for investment in housing sector. The reform has been chiefly introduced for first home buyers and hence has been announced on interest for loan up to Rs 35 lakh, provided the house value doesn't exceed Rs 50 lakh.
Deduction in basis point by RBI: With the Reserve Bank of India reducing its benchmark interest rate by a higher-than-expected 50 basis points to a four-year low, it the step is further encouraging for home buyers who can avail a home loan at a much lower interest rate. Although, the banks have been slow is passing on the benefit to the home buyers, they have still deducted their home rates by 30 to 35 basis point.
All the above reforms and development have definitely blessed 2016 to become a boon for the all the investors and home buyers. The year has given numerous reasons and opportunities to leverage from, making 2016 a good year to invest real estate.