RERA effect: Home segment gets 54% of realty funds in H1

Of the total $1,990 million investments in Indian realty in the first-half (H1) of 2017, the residential sector accounted for $1,075 million (54 per cent). While commercial realty saw an inflow of $796 million (40 per cent), retail got $119 million (6 per cent).

Explaining the trend, Anuj Puri, Chairman, Anarock Property Consultants, said, “Institutional investors have for long been waiting for greater transparency in the Indian real estate market, which has now arrived with the launch of RERA and GST.”

RERA effect “RERA will now ensure that only strong, credible developers with transparent business practices and ability to complete projects on time remain. Simultaneously, the supply pipeline has moderated, partly because non-credible players are forced to withdraw from the market, and also because developers are more cautious with new launches,” said Puri.

“All indicators point to a decisive return of buyer interest over the next 18-24 months. Institutional investors, which are in it for the long haul, are focussed on the positive signals emanating from the residential property market,” he added.

Festival outlook Market indicators point to increased sales during the coming festival season. The recent reduction in bank rates will also encourage buyers to take the advantage of lower home loan rates.

But residential demand still remains subdued due to the uncertainty wrought by many regulatory upheavals.

“Demonetisation put severe pressure on the resale market and also hit the primary market to some extent. Now, markets are recovering, thanks to RERA and GST, though both were expected to cause confusion for developers and buyers,” Puri added.