With the impacts of regulatory mechanisms such as RERA and GST kicking in with full force in 2018, the Indian real estate segment’s stakeholders seem to have finally accepted the new realities. Real estate in 2018 was all about transparency and accountability as the developers were seen putting a brake on the launching spree and focusing more on completing the existing projects.
Here are some the trends that shaped the residential real estate market in 2018:
Average property prices remained largely static across the top seven cities in 2018 with a marginal 1 percent increase as compared to last year.
With an annual increase of 16 percent, housing sales 2018 are estimated to be 2,45,500 units if we consider Q4 sales to match those of the preceding quarter – at 2,11,140 units in 2017, as per Anarock, Money Control reported.
Although the launch was lower than those seen in 2014, launch activity has recouped from last year.
In sharp contrast to what was considered not-so-classy earlier, the developers were all about affordable housing in 2018. 2018 saw almost every real estate developer, regardless of its market footprint and previous category orientations, eager to take a bite out of the affordable housing pie.
2018 will also be remembered as the year when the hassled home buyers were finally heard and represented. Be it Amrapalli fiasco or Jaypee’s case, the issue of stalled projects showed at least some signs of resolution in 2018.
Registering an increase of over 14 percent year-on-year from the same period last year, the residential sector raked inflows of Rs 126 billion (including residential platform deals) in year-to-date 2018. Mumbai had the lion’s share, followed by Chennai.
The inventory showed a modest decline of 8 percent over the previous year.
Development Management Model:
The trend was seen emerging in 2018 which in turn gave a new lease of life to several stalled real estate projects. Under this model, reputed developers were seen stepping in as development managers by partnering with asset-rich developers and thereby helping complete projects on time, in exchange for management fees, or a share of the revenue profits.