Real Estate Market on the Rise - Festive Season Boosts Property Demand

As India enters the festive season, the real estate market is witnessing a surge in demand. With the Reserve Bank of India (RBI) recently deciding to keep the repo rate unchanged, buyers can benefit from favorable interest rates, making this a great time for homebuyers to invest. Here's a closer look at the key factors driving the growth in the real estate market during this period.

1. Festive Season Fuels Homebuying Sentiment

A Time for Positive Energy Navratri, Dussehra, and Diwali are not just celebrations; they are periods of hope and positivity, inspiring families to make significant investments like home purchases. The festive season is considered an auspicious time for new beginnings, and many buyers are motivated to take advantage of this opportunity to secure their dream homes.

Developers Offer Attractive Discounts

To capitalize on this festive sentiment, developers are offering enticing discounts and promotions, such as waived registration fees, complimentary amenities, and exclusive deals. These incentives further boost demand, as buyers feel encouraged to make the most of these limited-time offers.

2. Strong Performance and Rising Demand

Growth in Sales and New Launches

The real estate sector has shown strong performance in recent months, with both sales and new property launches on the rise. According to Anshuman Magazine, Chairman & CEO of CBRE (India, SE Asia, Middle East, and Africa), property sales in the first three quarters of 2024 have been robust, surpassing figures from the previous year. With over 1.50 lakh properties sold in the first half of 2024 alone, the festive season is expected to bring further growth.

Luxury Homes in High Demand

The demand for luxury homes, especially properties priced between Rs. 2 crore and Rs. 4 crore or more, continues to grow. High-net-worth individuals (HNIs) and non-resident Indians (NRIs) are increasingly investing in high-end properties, driven by the desire for better returns on investment and an improved lifestyle. Additionally, the emerging upper-middle-class buyers are eager to upgrade to more luxurious homes, sustaining the demand for premium properties.

3. Developer Incentives: Taking Advantage of the Opportunity

Exciting Festive Offers

To attract buyers during the festive season, developers are rolling out significant discounts. These offers may include waived monthly EMIs, GST exemptions, free registration, stamp duty savings, and added perks like modular kitchens, electronics, and complimentary parking. Some developers are also partnering with banks to offer fixed interest rates for a limited period, making home purchases even more appealing.

4. Impact of Stable Repo Rates

RBI's Decision and Market Impact

The RBI recently decided to keep the repo rate steady at 6.5%, which is expected to stabilize the real estate market during the festive period. According to Anuj Puri, Chairman of Anarock Group, this decision reflects India's strong economic fundamentals, despite global uncertainties. The stability in interest rates is likely to support ongoing property sales growth into the fourth quarter of 2024.

Beneficial for Affordable Housing

The unchanged repo rate is particularly beneficial for the affordable housing segment, as it prevents home loan interest rates from rising. This will encourage more buyers in the lower and mid-price categories to invest in property during the festive season.

5. Bright Future for the Real Estate Market

Record Sales Expected

The Indian property market is poised to achieve record sales during the festive season, with an expected increase of 12-15% over the previous year. Indian real estate experts predict that 2024 will see the real estate market cross the 3 lakh unit sales mark for the second consecutive year, driven by strong demand and a positive buyer sentiment.

Sustained Demand for Luxury Homes

Luxury residential properties continue to attract high-net-worth buyers, NRIs, and the emerging upper-middle class. Developers are also enticing buyers with flexible payment options, GST relief, and other incentives, making this festive season an ideal time for real estate investment.

Key Facts and Figures:

• Repo Rate: Unchanged at 6.5%
• Luxury Home Demand: Significant interest from HNIs and NRIs for properties priced Rs. 2 crore to Rs. 4 crore+
• 2024 Sales: Over 1.50 lakh properties sold in the first half
• Expected Sales Increase: 12-15% rise in festive season sales compared to 2023
• Developer Offers: Free registration, GST exemptions, modular kitchens, fixed interest rates