The real estate market will see a revival not only in this festival season but also in the year to come.
The festive season plays a major role in boosting the sentiments of buyers due to the auspicious position it holds in the Indian culture. Like FMCG and automobile industries witness double digit growth in the festive season, housing sales also witnesses a similar trend. The recent rate cut of 50 base points by the Reserve Bank of India (RBI) has added to the cheer. It will give the much needed boost to the market and will incentivize home buyers to take a decision.
During this period, customers are keen to visit many projects to get a deeper and detailed understanding. This increases the number of customer walk-ins at the project site. In addition to increased walk-ins, the conversions also go up due to the customer’s belief in auspiciousness and hence their increased propensity to buy. Developers launch new projects, packed with new age amenities to give more options to house hunters.
With a view to cash in on the improved market sentiment, developers offer attractive schemes like 20:80 scheme, rent back scheme etc. which protect the interest of the buyer. In the 20:80 scheme, the buyer has to pay only 20 per cent of the total amount at the time of purchase and 80 per cent at the time of possession. The interest is borne by the developer till actual possession. The buyer starts to pay interest only after the house keys are handed over to him by the developer.
In the rent back scheme, the developer assures the buyer of a guaranteed possession date. If, however, the developer is unable to deliver within this period, he has to pay the rent for the entire period starting from the guaranteed possession date. This is helpful for buyers, especially those staying in a rented home. All such schemes ensure that the buyer gets his home within the stipulated period as committed by the developer.
If we consider the Mumbai real estate market, there is not enough stock in the market. Even though few pockets in the city have a realistic supply, this is not applicable across Mumbai. There is still a dearth of good quality homes in western suburbs like Andheri, Bandra etc. Over the past few years, there have been various infrastructure developments like the Metro Line from Ghatkopar to Andheri, Bandra Worli Sea Link, Eastern Freeway etc. These developments are making it easier for people to commute from one part of the city to the other. Also, with companies like Facebook, Abbott buying commercial spaces in Mumbai, the country’s financial capital becomes all the more attractive for residential buyers.
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