We interviewed Mr. Ravi Aggarwal – Co-founder and Group Managing Director, SignatureGlobal Group to seek his views on the recent developments in the real estate sector.
Below are the excerpts from his interview:
What is your perpective on the current state of real estate sector?
The current state of real estate sector seems to be beneficial for both the buyers and developers. The advent of regulating acts like RERA would give a positive approach to the homebuyers for the developers. The buyers and developers would move towards the transparent and accountable deals in the real estate climate. The reduction of interest rates on home loan by the financial institutions is yet another sign of relief for the first time home buyers.
The impact of GST and RERA on the pricing of real estate in the long run?
If the property comes under the under constructed section, then the buyer will have to pay the 12 per cent GST, else the property would be exempted from the GST. Buyers going for the ready to move in properties would enjoy the perks. However, RERA would be assuring credibility and transparency in the sector. By my reckoning, depending upon the stage of construction the price in the real estate units would vary.
Can affordable housing provide a strong push to the real estate sector?
According to latest survey, the total of 50 percent of sales was contributed by low cost housing projects. The survey said that the launches during the October-December 2016 were mainly the affordable sections. During last 6 months, Signatureglobal has sold more than 4000 units of affordable homes, which clearly defines the buzz in the affordable housing market. Also, the affordable housing projects are not only fueling the sales but also making it possible for the economically weaker sections and low-income groups in owning their own houses. We can clearly see the positive impact of affordable units in the real estate wing. However the latest amendments in the real estate policies are equally responsible for growth in the market.
Are you satisfied with the government’s current initiatives? What more do you expect from the government?
From the introduction of Pradhan Mantri Awaas Yojna (PMAY) to the implementation of RERA, we think that the government has been giving its best. In my opinion, it’s due to the government’s push that various financial institutions came up with reduced interest rates on home loans. The overall functioning of government for the affordable housing units is very appropriate. As far as our expectations are concerned, the government should reduce the GST rates on the affordable housing as the buyers would be paying 12 per cent GST for under constructed units in affordable housing too.
How do you see the demand patterns of affordable housing?
As per latest survey, India already has a housing shortage of approx 2 crores in urban areas and the reason behind this being the lack of affordability factor in the properties. The affordable housing units are a source of relief for the people who couldn’t purchase an own house. The real estate sector usually had high-priced units that led most of the sections to remain homeless and rely on rented property. In the last FY 2016-17, Signatureglobal has sold more than 2000 units of affordable homes and has a target of selling more than 10000 units of Affordable homes in FY 2017-18. As a step towards Shree Narendra Modi’s vision of “Housing for all by 2022”, Signatureglobal is targeting 1,00,000 affordable homes by 2022. As developers like us are introducing new projects based on the interest of such sections, more and more people are getting familiar with the existence of affordable property thus leading to the increased demand for the same.
We interviewed Mr. Rakesh Pai, Senior Vice President – Finance & Accounts of Redevelopment vertical of Shapoorji Pallonji Group (S.D. Corporation), to seek his views on the recent developments in the real estate and construction sector...Read more »