Optimistic Outlook for Housing Sales
The Confederation of Real Estate Developers Association of India (CREDAI) has voiced optimism, projecting a potential 20 percent surge in housing sales. This anticipated improvement is largely expected to be concentrated in India's major urban centers. Smaller cities, it's noted, have generally remained insulated from the impacts of fluctuating interest rates.
Interest Rate Impact
A slight decrease in home loan interest rates during the festive season is predicted to stimulate increased housing sales. Recent months have already seen a rise in inquiries, suggesting that prospective homebuyers, who have been waiting for the right moment over the past two years, may now find this period particularly favorable for making a purchase. The reduction in interest rates is being viewed as a positive signal for buyers.
Industry Perspective
Mr. Lalit Jain, the president of CREDAI, communicated to the media that interest rates have noticeably decreased. He further suggested that indications point towards a possibility of further reductions.
When comparing projected sales for the current year with those from 2011, he indicated an expected increase of approximately 20% across 26 major Indian cities. Further, he highlighted the approximate one-percentage-point drop in interest rates. Certain banks are also considering extending loan tenures from the current 20 years to 30 years. These converging factors are poised to provide a significant boost to sales. The preceding two to three years experienced a slowdown in home sales, primarily attributed to elevated interest rates that deterred potential buyers.
He mentioned that smaller cities remained comparatively unaffected during the past few years. It is expected that these smaller cities will not experience substantial growth rates this year either. Furthermore, sales are not anticipated to significantly increase in they areas.
Addressing Environmental Clearances
Concurrently, CREDAI has resolved to prioritize the acquisition of environmental clearances. This particular approval is often considered the most time-intensive aspect of the overall real estate project approval process.
Streamlining Approval Processes
Environmental clearance is sometimes viewed as an obstacle that can impede real estate projects midway, often justified on environmental grounds. Mr. Jain urged the environment department to address this issue. He emphasized that delays in approving real estate ventures can lead to substantial costs for the nation.
He additionally appealed to the environment department to formulate a comprehensive checklist that upholds environmental quality standards. This would enable approving authorities to assess projects against the checklist and grant approvals without unnecessary and disruptive delays.