Those who viewed the reforms that the central government brought to India’s real estate sector with scepticism are now backing the new regulations as they have resulted in transparency and helped clean up the business practices.
Thanks to the Real Estate (Regulation & Development) Act, 2016 and the Goods and Services Tax, the sector has become more structured and accountable.
They have also impacted the way builders practiced their business and the customer behaviour. Under the new rules developers have come under strict vigil while customers have gained confidence in their investment.
What is more the government’s proactive policy encouraging affordable housing has opened a new vista for investors giving a boost to the realty market.
Pradeep Aggarwal, Co-Founder & Chairman, Signature Global, and Chairman, National Council on Affordable Housing, of industry body ASSOCHAM says these reforms have also led to changes in developer strategies and customer buying patterns.
“We now see developers splitting their projects into smaller phases in order to reduce completion time, inventory overhang and manage cash flows,” he wrote. Additionally, end buyers are seeking security for their investments, and hence prefer
Prospective home buyers’ tax burden has also eased, following a 4% reduction in the goods & service tax (GST) to 8% leading to higher sales momentum, particularly in the affordable housing segment.
The Credit Linked Subsidy Scheme (CLSS) has also helped the affordable housing a lot. It has basically been a big step for the construction sector by increasing activity on the demand side.