Gujarat is now one of the most keenly followed industrial areas in India and rightly so, with the state being touted as the unique and prosperous developmental model carved out by the Prime Minister hopeful and erstwhile chief minister of Gujarat, Narendra Modi. How does the Gujarat real estate market look just before the elections are to be held? Read on to find out!
 |
| Gujarat Real Estate |
Developers and companies in the real estate space in Gujarat have always been concerned about regulatory hurdles and shifts. The general elections have given rise to political uncertainty and this certainly acts as a threat with regard to increasing the slump period which has engulfed the Indian realty sector at large. There is a symbiotic relationship shared between real estate and elections where the latter threatens to disrupt the progress of the former with a state of official stupor and lags in clearances, sanctions, disbursements and other official acceptances. The real estate business is largely dependent on policies and decisions made at the governmental level and the Gujarat real estate market is worried about any new changes in policy once a new government assumes control. The elections are very important for the market here and for solid reasons as well.
There are various pending bills that need to be passed for the welfare of the sector in general, including the Land Acquisition bill and the regulator bill. Alongside, political uncertainty does not harbor well for the sector too. These bills can never be actualized in case of an unstable government. Alongside, with the chief minister himself a top Prime Minister hopeful, the real estate market in the state is eagerly waiting for the outcome of the elections. The elections will have a huge impact on the real estate sector in Gujarat. This can be gauged by the fact that the micro market operations of real estate are increasingly dependent on bylaws and laws at a local level and this raises anxiety with regard to political scenarios and policy making post elections.
However, according to the CMD of CBRE South Asia, Anshuman Magazine, the real estate sector should not be too anxious about the impending elections as market sentiments are low anyway. Uncertainty is now way too closely connected to the economy for comfort in any case; business should go on irrespective of changes at the Centre. Market forces are responsible for the slump and not anything else according to Magazine. Election procedures bring about a slowdown in decision making and passing of projects. This year seems different with the economy slumbering and the housing sector as always, plays a key role in the overall health of the economy.
According to the RE/MAX Regional Owner Manan Choksi, the General Elections should actually boost the Gujarat real estate market in more ways than one. According to him, the slowdown has been generated owing to a slow economy in general and changes at the regulatory level. Political parties spend huge sums of money before the elections and this leads to higher circulation. The Prime Ministerial candidate being from Gujarat, the state should ideally witness loads of progress in this period. The real estate market should see better performance levels than other years due to such factors. Elections and other political moves often influence prices of property indirectly. Transaction numbers go down owing to unstable governments and politics as a result. There is a paralysis in policy making all throughout the country and this will continue till the elections are over.
However, irrespective of the party that comes to power, investments will come into the sector once this entire state of paralysis passes. According to the CII WR Infrastructure, Real Estate & Construction Sub-Committee, Anuj Puri, the elections would surely have an influence on the trends in the market and it will either speed up, continue at a laggard pace or simply slow down even further. Reforms, policies and stability are good for increased growth in the real estate sector. As a result, market sentiments can get a boost from the polls and this might harbor well for the real estate sector as well. There are various regulations and bills that are still awaiting approval and will be crucial for the growth of the sector. Any government will be keenly aware of the need for passing these bills as the real estate sector is largely responsible for the overall growth of the economy.
Puri remains confident about the actualization of these policies and the acknowledgement of the needs of the sector in the right governmental circles. Again, uncertainty in the political sphere might as well lead to a feeling of caution and gloom in real estate sectors. The market will be influenced even more owing to the polls. The revival of the real estate market in Gujarat is still a work in progress, even five years after the global slowdown. The government has a new economic policy to formulate along with the passing of several crucial measures and bills that will be a boon for the industry in general. The passing of these pending bills is what is foremost on every real estate developer’s mind in Gujarat.
This will have a direct bearing on affordable housing and will also even out supply constraints which lead to prices being jacked up. However, one thing is for sure: mention the prospect of the Prime Minister being from their state and the developers and real estate companies in Gujarat are ecstatic as this might as well spur greater development. However, they are confident about the passing of pending bills and other improvements irrespective of who comes to power. The mood in Gujarat is quite tense as the polls are about to come to town. Will affordable housing be possible once again and jack up sales volumes remarkably? Or will red tape and further delays prolong the much needed revival of the sector? Only time will tell and one can hope that it all smoothens out in the end!
No comments:
Post a Comment