Realty stocks met a new high this month with the Nifty Realty Index. With 25 percent gain in just four trading sessions, it has made an 11 year high. The realty index had fetched 3.6%, 8.5% and 5% gains on three consecutive days. The recent development has brought immense cheer in the real estate market. There are numerous reasons for latest increase in the Index.
The work-from-home situation has increased the demand of big and comfortable residential properties. Real Estate developers have as well made these properties more affordable. Lower interest rates on loans and other government policies like RERA and the Subvention scheme has aided to the growth of the real estate industry.
The Karnataka and Maharashtra state government’s decision to slash the stamp duty from 5 percent to 3 percent comes as a welcoming move. The amendment is applicable both on first-time registration of properties as well as on older properties. As of now, the reduction in stamp duty has elevated property registrations in both the states. Mumbai alone recorded 6000 property registrations within the first 21 days of September. The estimated rise in registration of properties accounted for 270 percent.
Pandemic’s bitter consequence on the real estate had made it necessary for modulating the market. Growth in infrastructure and development also rendered to the growth of sales. For example, Bengaluru’s upcoming metro connectivity has created a massive demand in the real estate market of the city. The Centre, the state and the property developers have been trying to keep the market intact with fascinating and customer-centric policies. This has eventually resulted in the fruitful return.
Stamp duty payable for properties priced between INR 35 Lakh to INR 45 Lakh is 3 percent, while a 2 percent reduction is set to be implemented on new registrations or primary sales. Revenue Minister, R Ashoka opined, how an enormous number of flats in Bengaluru and other cities were unsold due to the uncertainty of Covid-19. The new amendment will benefit the developers, who are burdened with ample inventories, and the buyers who might be facing an economic crisis.
The lower interest rates on home loans has also been a major cause for the upswing in property sales. RBI has been maintaining it for an extended period now. The transparency promoted by the RERA scheme has had the best effect on the real estate market. It has since, created a safe and trustworthy space for the buyers. The assurance on quality implemented by this scheme is as well an added bonus.
The figures of the Realty Index reflects how people are finally accepting the new normal. It also reflects the essence of good and wise policy-making. Now customers have a catalog of options to choose from. As revealed by a survey conducted by JLL-RoofandFloor, nearly 80 percent of prospective real estate buyers will invest in property in the next three months. This assuredly restores our faith for better days in real estate.