Financial Prudence: The Backbone of Real Estate Success
Maintaining financial discipline is crucial for real estate project success, and lowering home loan interest rates can boost demand.
Real EstateFinancial DisciplineHome LoanInterest RatesReraReal EstateJul 10, 2024
Arora emphasized that if developers maintain financial discipline from the inception of a project, it cannot fail. He advocated for a ratio of debt to equity and stressed the importance of rationalizing interest rates and lending rates to boost demand. Lowering home loan interest rates can encourage investors and homebuyers to come forward, and builders can deliver projects at competitive costs.
The Real Estate (Regulation and Development) Act, 2016 (RERA) has been instrumental in bringing transparency and accountability to the sector. Since its enactment, around 1,25,000 projects have been registered under RERA across India, and 75,000 brokers have also registered. Pradeep Aggarwal, Chairman of National Council on Real Estate, Housing and Urban Development at Assocham, highlighted the significance of the real estate sector in making India a top economy.
Vineet Relia, Director of Urbanbriq Development Management Pvt Ltd, warned that the sector may face a downcycle if the government does not provide adequate support in terms of affordability. In conclusion, financial discipline and government support are essential for the growth and success of the real estate sector in India.
Frequently Asked Questions
What is the market size of the real estate sector in India?
The real estate sector in India has a market size of around Rs 24 lakh crore.
What is the GDP contribution of the real estate sector in India?
The real estate sector contributes around 13.8 per cent to India's GDP.
What is the importance of financial discipline in real estate projects?
Financial discipline is crucial for real estate project success, and it helps developers maintain a healthy debt-to-equity ratio and rationalize interest rates and lending rates.
How many projects have been registered under RERA across India?
Around 1,25,000 projects have been registered under RERA across India since its enactment.
What is the impact of lowering home loan interest rates on the real estate sector?
Lowering home loan interest rates can boost demand, encourage investors and homebuyers to come forward, and enable builders to deliver projects at competitive costs.
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