Indian real estate sector is constantly evolving and changing for the better. All over the world, sincere investors are looking at Indian housing market with profound interest. The Group Chairman of Knight Frank, Alistair Elliott is quite confident about the Indian property sector and has opined regarding regulatory changes and many other decisions being taken in favour of the property sector. The Indian Government has already stepped up efforts to make real estate industry more progressive and enhancing greater transparency in dealings. With RERA and REIT, the real estate sector is poised for a positive shakeup which will bring more institutional developers and investors in the stream of real estate.
Let us understand more about RERA and REIT and how it can help boosting real estate in India:
RERA or The Real Estate Regulations and Development Act, 2016 is expected to make way for empowering all stakeholders who are engaged in the real estate business, whether real estate developers, consumers, intermediaries/brokers and others. This Act is expected to bring great changes in the real estate sector. At the same time, it is vital to understand that the Act do not encompass rental agreements or arrangements in any way. However, real estate, whether commercial or residential includes apartments, plots, offices and shops etc. will come under this Act.
This Act strives to address a variety of issues faced by the consumers and works to protect their interest. The Act plans to achieve the following:
- Protection of consumer rights
- Regulations to keep a tab on real estate brokers and developers
- Defining real estate developers’ duties
- Timelines set up for project registration and resolution of disputes
- Determine liabilities and penalties on stakeholders
- Functions and roles of Investors
Referred to as Real Estate Investment Trust, REIT is another factor that is going to bring a change in the real estate sector. It is basically a company owning or financing income generating real estate. These are similar to mutual funds and offer regular income, long-term capital appreciation and diversification to the investors. Income tax is paid by the shareholders on these dividends.
Anyone can invest in large scale properties portfolios as per REITs. This is done in the same manner as investing in other industries by purchasing stock. Similarly, the stakeholders also gain an advantage by having stocks in other companies.
Together with REIT and RERA the Real estate in India is expected to take a turn for the better and global investors can look for incredible investment opportunities. Under this scenario of the positive shift, prominent projects, integrated cities and mega housing schemes are to attract major investment from national and international investors. Projects such as Wave City Center in Central Noida have already been receiving the boost after its launch, because of its location and product mix meant for both end users and investors.
Among other investment hubs in India, Delhi NCR is expected to create and deliver more due to the demand and infrastructure and being a hub of job providers. Traditional markets are of low range and mid-range, whereas new markets are coming up with mixed options for different income groups dissolving the socio-economic gap.
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