Millennials are the New Affordable Home Buyers

If you are a homeowner looking to sell your residential flat in Gurgaon or any part of the NCT, the chances are you will be selling it to a millennial. It is seen that the millennials are the newest entry into the real estate sector. It is possible that today they are form the largest group purchasing homes for the first time. This seems to be a new trend, where earlier, this generation was known to rent housing in cities. So, what is it that you as a homeowner need to be aware of to cater to this population? Here are some quick areas.

One of the most important reasons for this generation to deviate from their original behaviour is the low rate of interest available in the market. The launch of the affordable housing scheme in Gurgaon, NCR, and other areas in the country have prompted millennials to think of investments in a sustainable manner. What could be a better investment than a real estate property? The confidence is high, and many of them believe that they would like to purchase a property. In addition, the availability of more financing options adds to their developing interest.  Nonetheless there are some hurdles paving their way.

If we look at the real estate scenario a little closely, we see that there is a shortage of affordable housing projects in the country. Even in Delhi NCR, which remain the top property destinations lack more options. The affordable housing project launched by the government intends to work well for low income groups and economically weaker sections. The millennials wanting to buy homes do not fall in this category, which calls for an extension of the criteria employed for the scheme.

In addition, most affordable projects are present in the city’s periphery, where transportation and basic amenities are yet to reach. In this scenario, working millennials find themselves unfairly tackling infrastructural limitations against their interests. With inter-city migration, especially for better economic opportunities, millennials prefer living closer to their work places and where there are amenities present round the year.

As a homeowner, it would a wise decision to invest in meeting some of these expectations. Enlisting yourself with a loan officer or working closely with a real estate agent will allow for matching your property with the right client. In addition, even though your property may not have luxurious countertops and club memberships, real estate agents can help millennials look for the right deals, such as a school district and a safe neighbourhood. Ensure that you are making the business as simple and easy as possible for the buyer. This could include easing the paperwork process, discussions about the down payments, and any credit issues that may need to be handled. The unfamiliarity may be an overwhelming experience for them and you can ensure that they have a good experience.

The market conditions are in favour of affordable homes than premium housing projects. Nonetheless, you may come across buyer expectations which may not suit your present situation. Research well about any additional investments into the project and see whether you will be rewarded by the market in the days to come. Millennials will continue to remain a strong contender in the real estate market as homebuyers especially because their economic projections are favourable. As a large population in the country is reaching their retirement, more millennials have stepped forward to fill their gaps. It is beneficial to see these new customers for the kind of influence they will have and leave on the real estate sector. After all, they are the future.

Signature Global is a reputed name in the real estate sector in India dealing in affordable housing projects. Signature Global’s residential flats in Gurgaon include their massive projects of Solera (Sector 107), Synera (Sector 81, NH8) Andour Heights (Sector 71), Orchard Avenue (Sector 93), Grand Iva (Sector 103), Roselia (Sector 95A), and Serenas (Sector 36). At present, Signature Global’s Signum project offers retail shops in Gurugram in sector 36, 95A, 93, 103, 71, 81, and 107. For bookings, check http://www.signatureglobal.in/retail

Affordable housing and Real Estate in Gurugram

The execution of the affordable housing projects is already speaking volumes and on the top of it, the demand for affordable housing projects is also being considered high.  Blooming demand for the residential affordable projects will undeniably give a huge boost to the real estate sector.  Even the industry experts and researchers have concluded that this sector is going to turn the corner within the next five years. According to the experts, affordable housing wing may see a rise of 37 percent by the financial year 2021-22 compared to the present scenario where it’s 26 percent.  The rankings of experts suggest that the demand for affordable homes has risen four times the existing stock to 250 lakh homes at this period.  The faster uplift in the market is due to the support of government bodies and alterations in the policies of the private firms. Be it the marked down interest in home loans or enactment of acts like RERA, the overall real estate segment has entered a transformation league which is enabling more buyers to invest. 

With the rapid development, the retail projects in Gurugram there is a noticeable spur in the commercial and residential affordable projects in Gurugram as well.   It all started with the Prime Minister’s initiative to provide housing to all, this initiative is being carried out under the scheme, “Pradhan Mantri Awas Yojana”. According to the government’s Credit-Linked Subsidy Scheme (CLSS), households with income of less than Rs 18 lakh are suitable to go for affordable LIG and MIG housing units under its interest subsidy scheme. As most of the people belonging to the low-income background are still struggling to purchase their own house, there is a huge demand for the affordable housing units. Being the low-cost units, such properties are a new hope for people aspiring to buy the first house. The frequently held meetings by the government authorities try to eliminate the challenges that are being faced by the developers and builders while executing such projects.  Also, there is a clear-cut statement by the experts that this segment is going to be the most established wing in the coming years. The policy makers and the financial institutions have made ample amount of amendments in order to assist the same PMAY scheme.

 “The higher demand will naturally give a boost to the execution of such projects making a positive impact on the urbanization as the affordability of homes would be high. The government’s push and cooperation from the private firms have helped the sector to its fullest. Not just the PMAY but the recent amendments assuring laws and transparency have perked up the sector.  Not just the affordable housing projects but also the commercial projects in Gurugram would get a benefit as the whole of this market is getting evolved. Being a developer, we expect this progress to enhance further and grow at a faster pace. The assured transparency would create a huge difference in the market as it would revive the lost trust of the investors says Pradeep Aggarwal, Chairman, Signature Global.

Affordable Housing In Gurgaon

Signature Global Real Estate Updates - Affordable Housing in Gurgaon: Affordable housing in Gurugram

Signature Global Real Estate Updates - Affordable Housing in Gurgaon: Affordable housing in Gurugram: Since the policy assuring housing for all has been initiated by the Prime Minister, there has been a major drift in the functioning and po...

Affordable housing in Gurugram

Since the policy assuring housing for all has been initiated by the Prime Minister, there has been a major drift in the functioning and policy making of the real estate sector. The Pradhan Mantri Awas Yojana has persuaded many of the developers and builders to look up to the needs of a common man.  The real estate sector was much more inclined towards the luxury aspect and focusing at the high –cost housing projects. In the middle of the smart city and high-priced projects what made the real estate segment lag behind was the fulfillment of the needs of a common man who could only afford low-cost housing units. Realizing the need of a common man, the government launched the PMAY policy dedicated to the affordable housing.  The aim of the policy is to provide an own house to all the families who have been aspiring for the same for a long time. The initiatives for the affordable housing units are being taken by various states as they have already introduced low-cost projects in their regions.  

 

Not only was the common man’s demand but credibility and transparency had also been at par with the real estate sector that led to the visible crash in the market. Enactment of RERA has been introduced as one way to bring back the credibility and transparency into the sector. The lack of transparency had left many people dubious and reluctant about making investments in the real estate sector. The array of laws and policies supporting the needs of a common man has given developers the opportunity to reach out to more and more buyers and suffice their needs while giving a boost to the market.  Regarding the affordable housing segment, various financial institutions have now introduced low-interest rates on the home loans and other similar benefits for the people going for their first house.  The GST implementation is one such enactment that will enable buyers to know where exactly how their taxes get calculated. The simplified taxation process will let people see the whole of real estate sector as a profitable and dependable segment.  States like Haryana have not just initiated with the affordable housing units but the developers like Signature Global have recently introduced RERA certified projects to make it to the pace of the current market.

The developers keen to launch affordable units have also requested the government to provide some ease in the form of reduced land prices and shared their challenges related to land availability. The authorities of all states have been working vigorously to help out the developers with their challenges.  Most of the developers have realized that they will have to work in accordance with the governmental schemes and public demand so they are promptly coming up with low-cost projects to gear up the market. 

“We have prioritized affordable or low-cost projects realizing the need of majority so we are happy with the fact that authorities from all the states are paving way for such projects. This will enable us to reach out to the other regions with our affordable projects.  As far as Gurugram is concerned, we have been executing easily affordable housing projects in Gurugram are still busy promoting them” says Pradeep Aggarwal, Chairman, Signature Global.

Government pushes state government to adapt RERA

Since the RERA has approached, the experts are seen busy knowing the ins and outs of this regulatory act. It’s mandatory for all the states to inculcate this act as per the government orders. Most of the states have initiated and are busy showcasing their RERA certified projects. However, there are states that are yet to come up with any statement regarding this amendment. Thus, the government has now directly asked all the states to establish RERA in their guidelines. The central government is persuading the state authorities to implement the Real Estate Regulatory Act which is said to turn the corner for the whole of the real estate climate. Without a regulatory act like RERA, the real estate segment is null and void which makes the investors hesitate while coming forward for new investments. The RERA will not allow the unregistered projects to woo the buyers by coming up with convincing advertisements.

“We have recently announced our plan to construct RERA certified projects and hoping to see a positive response from more and more investors and home buyers. We believe that the other developers should also initiate and take a step in line with the RERA as it will benefit them in long run. RERA is being known and promoted as the most credible regulator so it’s a mandate that no developer and state government should ignore. We need to understand it’s more important to bring back the accountability sand trust for this sector and regulations like such would help in achieving the same motive” says Pradeep Aggarwal, Chairman, Signature Global.

Affordable Housing Projects in Gurgaon - Signature Global

Urbanization of Delhi NCR and Affordable Houses

As per 2011 census, the urban population in India is increasing at a rate of 2.8% per year. The increasing concentration of people in urban areas has led to the problems of land shortage, housing shortfall, congested transit and has also severely stressed the existing basic amenities such as water, power and open spaces of the towns and cities. Haphazard urbanization has forced people in Middle Income Group to live in slums for years. Housing companies were mostly involved in luxurious housing for better premiums and profits and government was providing affordable housing for only economically weaker sections of the society till now.

But recently, the scenario is changing. With the advent of innovative ideas and newer technology, developers are changing the definition of affordable housing in Gurgaon. “Affordable” is a relative concept with several implications in different income groups. Whereas, previously it was associated with economically weaker sections in want of roof and security. Today, it’s a whole new segment in the real estate industry catering to needs of several income groups. With the government providing subsidies for Middle-Income Groups, the dream of a home for the fence-sitters is becoming a reality.

Also, in a step to fulfill the Prime Minister’s vision to provide “Housing for All” by 2022 the private players are now becoming active to provide residential houses in Gurgaon for office goers in Delhi NCR. The people who were paying heavy rents in Delhi NCR can opt for a house which is affordable according to their pocket with a convenient EMI.

Affordable Housing – a key growth driver in realty sector of Delhi NCR can be broadly defined on four parameters:

The minimum volume of the habitation: As architecture is moving vertically due to increasing in population density and shortage of land. Instead of area standard, affordable housing takes in purview volume standard and how to minimize it with expertise in architecture.

Provision of basic amenities: Provision of basic amenities such as sanitation, adequate water supply, and power to the dwelling unit is crucial while defining affordable housing. Maybe, the housing society doesn’t have a swimming pool or a gym but it is mandatory for the society to be accessible from a different part of the city especially if we talk about flats in Gurgaon. Delhi NCR being a cosmopolitan area calls for easy access and prime addresses. Also, provision of community spaces and amenities such as parks, schools, and healthcare facilities, either within the project or in the neighborhood, are desirable depending on the size and location of the housing project.

The cost of the house: While accessing the cost of a house it is always important to consider the buying cost as well as the maintenance cost. Affordable housing in India has become more desirable after the advent of Real Estate Act as it makes first five years of possession maintenance free. A thought should also be given to the kind of vehicle which is necessary for the accessibility. If the society is too remote higher transportation cost will lead to migration again.

Location of the House: Entailing from the points already made above residential projects in Delhi NCR should be well connected to the workplaces, marketplaces and fun centers. The lower land cost may provide cheaper housing possibilities but if housing and transportation costs burn a hole in the pocket of the resident, the possibility to regulate slums and residential colonies to decongest the national capital won’t be possible.

Affordable houses in Gurgaon can change the way people looked at townships and residential projects towards a cumulative growth of Delhi NCR. This is a systematic approach which will not only ease the tight realty markets but will also curb the problem of congestion by decentralizing things. The Middle-Income Groups who were forced to compete with each other for renting scarce homes in the national capital can have an affordable nest of their own.

Tips to Navigate the Real Estate Sector Post-Demonetization

What seemed like a hibernation of at least five years, the real estate sector gradually seems to be finding attention among home buyers again. In a recent survey conducted online, it was found that more than 60% of the respondents are likely to buy a property in the next one year period. In the wake of the rate cuts by the RBI, 16% of the respondent said that they will buy a real estate. This optimism is more pronounced in Hyderabad, Pune, and Mumbai whereas cities like Bengaluru and Delhi NCR were lagging behind. In these cities, high inventories & prices have not yet uplifted the dampened spirits. It is likely that the real estate prices are likely to increase, and the returns from investments may lack consistency. In such a scenario, caution displayed would be the ideal move.

Although real estate has continued to be a substantial investment in India, buyers have been aware of the financial crunch especially after demonetization, which has led to mounting inventories and unfinished projects. In some cases, delays have ranged anywhere between 5-6 years. This trend has caused buyers to choose ready-to-move-in properties rather than the under-construction projects and pre-launch offers. Even with the Real Estate Regulation Act 2016, buyers do not feel confident that the act guarantees the buyers’ interests. So what does one do in a market like this? Experts have the following suggestions:

Experts believe that it is best to research well regarding real estate properties, a basic rent vs. buy analysis should help one decide what step to take. For instance, it is not within everyone’s capacity to spend extravagant EMIs such as INR 80,000 for a premium luxury project but the same can be afforded for a cheaper rent. Likewise, even in cities where buying a property would cost more, there are renting options such as those available under affordable housing in Gurgaon and NCR.

One should also consider the cost of settling down with a property, which significantly reduces the chances of upgrading to other cities, and lucrative job opportunities. Especially true for young people who are still building their careers, it is advisable to not become tied down because of mortgage. That said, experts do point that in cities like Hyderabad and Pune, it is still possible to buy properties, where the EMIs are roughly equivalent to the rent being paid – not a bad choice to create assets for the loan borrower.

Respondents have also claimed that the biggest hurdle for them when buying a property is the high interest rate on home loans and reduced tax benefits. It seems that along with this reason, there are other factors that potential buyers are considering, one being their estimation of their income increase. Some other reasons include rate cuts on home loans ranging between 2% – 12.8%, decline in property prices between 10% - 57.2%, and more payment options afforded by the builders.

Respondents also believe that they would prefer to go for loan options where they can seek the maximum loan which is available to them, which ranges anywhere between 70% - 80% of the property value. This suggests that although there are buyer sentiments which incline toward buying properties, the environment plays an important role in the decision-making.

Experts suggest that for such buyers, consolidating the available finances would help them understand how much they can afford to pay off as the down payment. After all, the bigger the down payment amount, the lower the EMI that would greatly stabilize the monthly budget.  However, they caution that buyers not to look into savings which are meant for education, retirement, or marriage. More importantly, experts advise that maintaining a good credit score will help lenders and banks to consider the best option available for the home loan. This includes keeping expenses low and not revolving credit card dues. 

Even though the real estate sector is lifting itself up out of the slump, the trick to survive and own a dream house is to be careful and research well. The wait will pay itself off.

Signature Global is a reputed name in the real estate sector in India dealing in affordable housing projects. Signature Global’s residential flats in Gurgaon include their massive projects of Solera (Sector 107), Synera (Sector 81, NH8) Andour Heights (Sector 71), Orchard Avenue (Sector 93), Grand Iva (Sector 103), Roselia (Sector 95A), and Serenas (Sector 36). At present, Signature Global’s Signum project offers retail shops in Gurugram in sector 36, 95A, 93, 103, 71, 81, and 107. The upcoming projects include The Millennia (sector 37D) and Solera Phase 2, (sector 107).