Lower home loan interest rates will provide much-needed relief to homebuyers by reducing their equated monthly installments (EMIs), making property purchases more affordable. Industry leaders believe this decision will drive housing demand, boost market activity, and encourage more investments in real estate.

A Positive Step for Homebuyers and Developers

Manju Yagnik, Vice Chairperson of Nahar Group and Senior Vice President of NAREDCO Maharashtra, welcomed the decision, stating, “The RBI’s decision to cut the repo rate by 25 basis points to 6.25% is a welcome step for the real estate sector, especially as this is the first reduction since February 2023. Lower home loan interest rates will provide much-needed relief to homebuyers, making property purchases more affordable by reducing EMIs. This move is expected to drive demand for housing, boosting market activity and encouraging more people to invest in real estate. It also enhances confidence among both buyers and developers, leading to a stronger and more dynamic sector. Developers will benefit from easier access to funds, helping them complete projects faster and meet the rising demand. At the same time, this decision aligns with the government’s focus on economic growth, supporting long-term stability in the housing sector. This rate cut is a much-needed push that will help both homebuyers and developers while driving positive momentum in real estate.”

The cut in the repo rate is expected to reduce borrowing costs, which will not only make home loans more affordable for buyers but also ease financial stress for developers.

Sunny Bijlani, Joint Managing Director of Supreme Universal, emphasized the benefits for both homebuyers and developers, saying, *“The RBI’s decision to cut the repo rate by 25 bps from 6.50% to 6.25% in February 2025 is a significant boost for the real estate sector, particularly for homebuyers and developers. Lower borrowing costs translate into reduced home loan EMIs, making property purchases more accessible, especially in the premium and luxury segments. This move will not only ease the financial burden on existing homeowners but also encourage new buyers to enter the market, strengthening overall demand.

For developers, the rate cut means lower financing costs, enabling them to fund projects more efficiently and accelerate delivery timelines. With capital becoming more affordable, we expect renewed momentum in high-end real estate, where buyers seek quality living spaces with long-term value appreciation. The increased liquidity and affordability will help clear unsold inventory, drive sales, and sustain the sector’s upward trajectory in 2025.”*

Encouraging First-Time Buyers

Experts believe that this rate cut will be especially beneficial for first-time homebuyers. Lower interest rates mean reduced financial burdens, making homeownership more attainable, particularly in the mid and premium housing segments.

Dharmendra Raichura, VP & Head of Finance at Ashar Group, highlighted the advantages for new buyers, stating, “The Reserve Bank of India’s (RBI) decision to reduce the repo rate by 25 basis points to 6.25% is expected to have a positive impact on the real estate sector, particularly for first-time homebuyers. With lower home loan interest rates, our homebuyers will find housing more affordable, especially in the mid and premium segments. This reduced financial burden will boost property demand, encouraging more purchases and enhancing market liquidity. Developers will also stand to benefit from improved cash flow and reduced financing costs. This will enable us to stimulate construction activity, leading to more real estate projects and employment. This policy shift, combined with stabilizing inflation and accelerating urbanization, creates a favorable environment for our customers to invest in their dream homes. With growing market confidence, developers are committed to delivering long-term value and success to our customers in 2025.”

The Road Ahead

With the RBI’s rate cut, banks and financial institutions are expected to pass on the benefits to borrowers, leading to a reduction in home loan interest rates. This will likely trigger an uptick in home sales, particularly in metro cities where property prices have been rising. The move also comes at a crucial time when urbanization is accelerating, and the demand for quality housing continues to grow.

While the real estate sector has seen steady demand over the past few years, affordability has been a key concern, especially for first-time homebuyers. With the repo rate cut, housing finance is expected to become more accessible, allowing more people to enter the market and invest in their dream homes.

Overall, this decision is a strong signal from the RBI in support of economic growth, and experts believe it will drive long-term stability in the real estate sector. As homebuyers enjoy lower EMIs and developers gain easier access to funding, the housing market is set to gain fresh momentum in 2025.

Also Read: RBI interest ratees

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Currently, open houses are held weekly at the MahaRERA head office in Mumbai, where senior officials address queries from developers. Despite assistance from Self-Regulatory Organisations (SROs), developers often encounter challenges that require clarification. Responding to requests from developers in other regions, MahaRERA has decided to extend this initiative to Nagpur and Pune.

During these open houses, officials from financial, legal, and technical departments will provide on-the-spot resolutions to issues related to project registration. Developers are encouraged to attend with all necessary documents to ensure a smooth process.

To further facilitate registrations, MahaRERA recently reduced the minimum project requirement for forming SROs outside the Mumbai Metropolitan Region (MMR) from 500 to 200. This decision is expected to simplify the registration process for developers across Maharashtra.

As per the Real Estate (Regulation and Development) Act, 2016, housing projects cannot be advertised or sold without RERA registration. MahaRERA has emphasized the importance of submitting complete and accurate information during registration to expedite the process.

“The Real Estate (Regulation and Development) Act, 2016, clearly states that housing projects must be registered with RERA before advertising. MahaRERA has established a robust framework for legal, financial, and technical aspects of project registration. By extending open houses to Nagpur and Pune, we aim to make the process seamless for developers,” said the MahaRERA chairman.

Developers are urged to utilize this opportunity to address any issues and ensure compliance with RERA regulations.

Also Read: builder fined by MahaRERA

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The ₹200.23 crore includes compensation from multiple regions, with the highest recovery seen in Mumbai suburban and Pune. Of the total, Rs 46.47 crore was recovered from Mumbai city, Rs 76.33 crore from Mumbai suburban, and Rs 39.10 crore from Pune. Other regions such as Thane, Nagpur, Raigad, Palghar, and Sambhajinagar also contributed to the recovery, while some districts, including Sindhudurg, Satara, Ratnagiri, and Solapur, still have pending recoveries.

MahaRERA’s ongoing recovery efforts aim to ensure that homebuyers who have faced delays or issues with developers receive their rightful compensation, including interest, refunds, and damages. The authority has issued a total of 1,163 warrants to recover Rs 705.62 crore from 442 real estate projects, out of which Rs 200.23 crore has already been successfully recovered from 283 warrants involving 139 projects.

To improve the efficiency of these efforts, MahaRERA has introduced a new initiative. Retired Tahsildars will be appointed in the offices of the District Collectorates in Mumbai suburban and Pune to expedite the recovery process in regions with high arrears and numerous complaints. This initiative will be piloted in these areas, and based on its success, similar appointments may be considered in other districts as well.

MahaRERA has also been working closely with the District Collectorates and other local authorities to ensure the smooth recovery of dues. The authority emphasizes the importance of coordination between various government departments to facilitate the collection of compensation, especially when developers fail to pay within the prescribed timelines.

According to MahaRERA Chairman, Manoj Saunik, the appointment of retired senior officers from the revenue department has significantly accelerated the recovery process.

“MahaRERA, on various complaints, issues orders regularly to compensate aggrieved homebuyers. Our role is to ensure that the compensation ordered is received by the aggrieved homebuyers, so they get adequate legal and financial relief. To facilitate this, MahaRERA has appointed a retired senior officer from the revenue department, and through him, such cases are consistently followed up with all concerned District Collectors, Deputy Collectors, and Tahsildars. Therefore, this process of recovery has gained momentum,” said Saunik.

MahaRERA’s recovery efforts, district-wise:

• Mumbai City: Rs 85.79 crore due from 35 warrants in 19 projects; Rs 46.47 crore recovered from 22 warrants in 13 projects.
• Mumbai Suburban: Rs 304.45 crore due from 440 warrants in 115 projects; Rs 76.33 crore recovered from 85 warrants in 42 projects.
• Pune: Rs 189.82 crore due from 258 warrants in 131 projects; Rs 39.10 crore recovered from 57 warrants in 36 projects.
• Thane: Rs 62.58 crore due from 191 warrants in 81 projects; Rs 11.65 crore recovered from 27 warrants in 15 projects.
• Raigad (Alibag): Rs 23.79 crore due from 116 warrants in 45 projects; Rs 7.49 crore recovered from 57 warrants in 18 projects.
• Nagpur: Rs 10.62 crore due from 18 warrants in 6 projects; Rs 9.65 crore recovered from 13 warrants in 2 projects.
• Palghar: Rs 19.86 crore due from 79 warrants in 32 projects; Rs 4.49 crore recovered from 8 warrants in 6 projects.
• Sambhajinagar: Rs 4.04 crore due from 13 warrants in 2 projects; Rs 3.84 crore recovered from 9 warrants in 2 projects.
• Nashik: Rs 3.85 crore due from 6 warrants in 5 projects; Rs 1.12 crore recovered from 4 warrants in 4 projects.
• Chandrapur: Rs 9 lakh payable from 1 warrant in 1 project; Entirely recovered.

Despite significant progress, recoveries remain pending in districts like Sindhudurg, Satara, Ratnagiri, and Solapur, where smaller amounts are yet to be collected.

MahaRERA continues to prioritize the recovery of compensation for homebuyers, working closely with local authorities to ensure that developers comply with the orders for refunds and damages. Under the Real Estate (Regulation and Development) Act, 2016, the District Collectors are authorized to recover dues as arrears of land revenue, a process supported by the Maharashtra Land Revenue Act, 1966.

As MahaRERA continues its efforts, homebuyers can expect greater accountability and relief through effective governance and streamlined recovery processes.

Also Read: MahaRERA Invites Objections to De-Registration of Macrotech and Raheja Projects Along with 17 Others

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Prashant Sharma, President, NAREDCO Maharashtra
“The real estate sector in Maharashtra looks forward to proactive governance that fosters growth and investment. Our key expectations from the new government include faster clearances for real estate projects, an improved ease of doing business environment, and policies that promote affordable housing. A collaborative approach between the government and industry stakeholders can not only streamline development processes but also ensure that the state remains a leader in infrastructure and housing innovation.”

Kuldeep Jain, Founder & CEO, Build Capital
“As Maharashtra ushers in a new government, the focus should be on driving economic growth through streamlined approvals and transparent regulations. A balanced policy framework that promotes development while ensuring sustainability is crucial. Addressing delays in environmental and regulatory clearances is essential. Implementing a timeline-driven clearance policy and a unified one-window system will reduce bottlenecks, enhance transparency, and instill confidence among developers and financial institutions. This will pave the way for innovative financing solutions, benefiting both developers and homebuyers. Infrastructure-led growth corridors must be prioritized to unlock emerging markets, boost connectivity, and attract private equity investments, positioning Maharashtra as a key economic driver. A progressive and transparent regulatory framework will ensure sustainable growth and solidify the state’s reputation as a premier investment destination. The new leadership must act decisively to secure Maharashtra’s prosperous future.”

Vikas Sutaria, Founder, Iraah Lifespaces
“Maharashtra’s real estate sector requires a forward-thinking government that recognizes the potential of luxury and second-home markets. By focusing on infrastructure connectivity, especially in emerging regions like Alibaug and Lonavala, and introducing tax incentives for investments in premium projects, the state can attract high-net-worth individuals and investors. Streamlining policies for sustainable and luxury developments will create a more robust real estate ecosystem.”

Anil Mutha, Chief Visionary & Co-Founder, Nandivardhan Group
“With the new government in Maharashtra, the real estate sector stands at the brink of transformative growth. Streamlined regulatory processes to expedite project approvals will accelerate the construction cycle, creating benefits for both developers and homebuyers. Prioritizing infrastructure development in connectivity and utilities is vital for unlocking the potential of emerging real estate markets. Enhanced infrastructure will not only attract investments but also improve living standards across the state. Additionally, fiscal incentives such as reduced stamp duty and tax benefits could play a pivotal role in revitalizing buyer sentiment. A strong, collaborative dialogue between the government and industry stakeholders is essential to address persistent challenges and realize the sector’s immense potential. We remain optimistic about bold actions that will fulfill housing aspirations, elevate living conditions, and contribute significantly to Maharashtra’s economic growth.”

Samyak Jain, Director, Siddha Group
“The real estate sector in Maharashtra anticipates a new government that prioritizes sustainable growth through faster project approvals, streamlined RERA compliances, and enhanced connectivity to boost infrastructure development. Additionally, incentivizing affordable housing, reducing development costs, and ensuring a transparent regulatory environment will position Maharashtra as a leader in creating holistic urban spaces and driving future growth.”

Shraddha Kedia-Agarwal, Director, Transcon Developers
“As industry stakeholders, we anticipate a government that champions reform and efficiency. We urge the new leadership to focus on single-window clearance systems, rationalization of stamp duty, and innovative financial support for developers. Strengthening infrastructure around growth corridors and supporting sustainable urban development will also catalyze sectoral growth.”

Vedanshu Kedia, Director, Prescon Group
“The new government must prioritize urban regeneration, particularly slum rehabilitation and redevelopment projects along with city/town beautification projects, which are crucial for a city like Mumbai. Additionally, fostering an investment-friendly ecosystem through regulatory consistency and infrastructure upgrades will drive the growth of the sector and enhance Maharashtra’s real estate appeal.”

Rohan Khatau, Director, CCI Projects
“Our primary expectation from the new government is to create a policy framework that simplifies regulatory processes and fosters confidence among developers and homebuyers alike. Reducing the tax burden, including stamp duty and GST, and ensuring smoother project execution can unlock the potential of the real estate sector, making Maharashtra a global investment hub.”

Govind Krishnan Muthukumar, Managing Director & Co-Founder, Tridhaatu Realty
“The new government must prioritize policy frameworks that streamline key initiatives, particularly in urban centers like Mumbai. Addressing bottlenecks in approvals and introducing incentives for redevelopment will not only rejuvenate aging infrastructure but also create much-needed housing. Additionally, the government’s focus should be on fostering public-private partnerships that ensure timely execution of urban regeneration projects while maintaining sustainability at the core.”

Himanshu Jain, VP – Sales, Marketing & CRM, Satellite Developers Private Limited (SDPL)
“The real estate sector looks forward to the new government focusing on holistic urban planning and infrastructure upgradation. Policies that address challenges like approval delays, high financing costs, and project execution bottlenecks can transform the state into a real estate powerhouse. The introduction of single-window clearances, along with reforms in taxation such as reduced GST and stamp duty, will greatly enhance the ease of doing business.”

Deepak Nair, COO & Co-Founder, The Mentors Real Estate Advisory Pvt. Ltd.
“We hope the new government will adopt a consultative and industry-inclusive approach to policy making. Simplifying regulatory compliance, promoting ease of doing business, and reducing approval timelines can significantly accelerate real estate development. Moreover, introducing measures to encourage foreign investments and infrastructure development around key urban hubs will elevate Maharashtra’s real estate sector to global standards.”

Also Read: Residential Market Sees Growth in Sales and Value, Led by Luxury Segment in Q3 2024

The post Maharashtra’s Property Market Eyes Major Reforms With Formation of the New Government appeared first on Square Feat India.

This debt reduction comes on the back of a remarkable surge in sales revenues. The booking values for these eight companies have seen a stunning rise of 234% from FY 2019 to FY 2024, from INR 27,144 crore to INR 90,573 crore, reflecting robust demand for residential properties across India.

In the first quarter of FY25 alone, these developers recorded a collective booking value of INR 26,832 crore—almost matching the total sales booked during the entire FY 2019. This figure also represents 30% of the total booking value for FY 2024, with three more quarters left in the financial year.

Key Players and Debt Reduction

The top eight developers—Sobha Ltd., Puravankara Ltd., Prestige Estates, Kolte Patil, Mahindra Lifespace Developers Ltd., Godrej Properties Ltd., DLF Limited, and Lodha Developers (Macrotech)—have all seen a notable reduction in their net debt.

DLF Ltd. led the charge, slashing its debt by over 165%, aided by a cash surplus of INR 2,896 crore. Kolte Patil also reduced its debt by over 107%, reporting a cash surplus of INR 37 crore. Lodha Developers saw an 83% decline in net debt over the same period, further underscoring the strong financial health of these companies.

Rising Debt Amid Expansion

However, not all developers experienced a decline in debt. Some saw their debt levels rise during this period, which is largely attributed to aggressive land acquisitions and geographical expansion. Despite this, the overall financial performance remains strong, as increased debt in certain cases was offset by substantial growth in bookings and revenue.

A Strong Recovery

Dr. Prashant Thakur, Regional Director and Head of Research at ANAROCK Group, commented on the findings, saying, “The significant reduction in debt for the top eight listed developers reflects a solid recovery for the sector. The surge in residential sales, coupled with a reduction in debt, highlights the strong fundamentals driving the real estate market.”

He added, “The rise in debt for some developers is mainly due to their expansion activities, with many on a land-buying spree. However, even these companies are seeing impressive booking values, which should translate to better financial health in the coming quarters.”

The substantial growth in residential sales across India, particularly in the top seven cities, has fueled buyer demand for branded and trusted developers. The data points to a positive trend in the real estate sector as these companies leverage strong sales performance to reduce debt and strengthen their financial positions.

Looking Ahead

With three quarters left in the current financial year, the prospects for the top developers remain promising. The first quarter of FY25 alone has already demonstrated the potential for another record-breaking year in terms of booking values. Given the ongoing demand and strong sales momentum, the real estate sector appears poised for continued growth.

Also Read: ₹10 lakh crore debt sanctioned for real estate from 2018-23

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Developers have been instructed by MahaRERA to open three separate bank accounts in a single bank, namely, 1) RERA Designated Collection Account- For all revenue received from homebuyers, 2) RERA Designated Separate Account- For 70% of funds allocated for project’s land and construction, and 3) RERA Designated Transaction Account- For balance 30% of revenue received. This decision will be effective from 1st July

RERA Designated Collection Account and RERA Designated Separate Account are legally protected from getting attached by any government agencies

Ultimately, this decision will help in enhancing the flat purchaser’s confidence and further improve the real estate sector’s credibility. This is another significant decision by MahaRERA for improved customer experience

 Starting July 1, developers in Maharashtra will not be able to take money from homebuyers and deposit in different bank accounts as it will become mandatory for them to maintain different designated bank accounts for purposes as stated by the Maharashtra Real Estate Regulatory Authority (MahaRERA).

So far, several developers have been asking homebuyers to draw payments towards different bank accounts for different purposes. For example, flat booking amount is deposited in one bank account and another bank account for amenities and infrastructure such as gymnasium, swimming pool, parking, etc.

To discontinue this practice and enforce discipline, ensure compliance, enhance efficiency, transparency, accountability and uniformity in financial operations of housing projects, thereby securing and protecting homebuyers’ investments, the MahaRERA has mandated developers to open three bank accounts in a single bank.

These include 1) ‘RERA Designated Collection Account’ for 100% of revenue from the flat buyer, 2) ‘RERA Designated Separate Account’ for 70% of funds allocated for project’s land and construction and 3) ‘RERA Designated Transaction Account’ for balance 30% of funds.

This directive will be mandatory to follow and effective from July 1, 2024. Relevant consultation paper was issued in mid-March to discuss the same with various stakeholders. Following extensive consultation and discussion, these measures will now be implemented.

Projects with more than one promoter will also have the flexibility to open a ‘RERA Designated Master Account’ to receive all collections from the homebuyers.

Section 4(2)(i)(D) of the Real Estate (Regulation and Development) Act, 2016, has a provision for dedicated bank accounts. This is to ensure transparency, financial discipline and better monitoring of transactions.

It is mandatory to segregate 100% of the revenue, that is the amount related to apartment’s booking and other charges (excluding government taxes and charges), received from the homebuyers. Thereafter, a minimum of 70% of the revenue will have to be transferred to another account, i.e. RERA Designated Separate Account, solely for land and construction expenditures. The balance 30% of the revenue can be transferred to the RERA Designated Transaction Account. Banks will facilitate this process through auto sweep. Funds in any of these accounts cannot be withdrawn via cheques, online banking, credit cards, debit cards or any other means.

With the entire operating procedures defined for receipt, expenditure and refund, the developers will not be able to excuse themselves, citing lack of funds, from returning the booking amount to those flat purchasers who intend to exit the project.

If a homebuyer cancels their registration, they will have to pay back 70% of the amount received as well as compensation for any losses from RERA Designated Separate Account. Interest on the amount will also be applicable. Furthermore, 30% of the original amount will be transferred from the developer’s RERA Designated Transaction Account.

In case of cancellation of a flat’s booking, the homebuyer in several instances has to take a time consuming and longer route of lodging a complaint, attending hearings, securing an order, sending relevant documents to the district collector for issuing of recovery warrants. This entire lengthy process will be shortened as funds will be available with the developer to refund and compensate the homebuyer for losses, if any. With bank details and funds available now, MahaRERA can efficiently provide instructions for recovery from the specified account. This decision will be crucial for such recoveries and prove to be a game-changer.

For the developer, the RERA Designated Transaction Account will be utilised for project related expenses other than land and construction.

RERA Designated Collection Account and RERA Designated Separate Account are legally protected from getting attached by any government agencies. The bank has to be vigilant that they do not allow creating any third party encumbrances on either or both of these two accounts. The collection and diversion of funds to any unauthorised accounts will be unacceptable.

All transactions in these RERA designated bank accounts will have to cease upon project’s completion. The bank accounts cannot be used unless MahaRERA extends the project. The developer cannot alter the bank account without MahaRERA’s approval.

Funds can be withdrawn only on submission of certificates from project’s chartered accountants, engineers and architects. If there is more than one promoter, their responsibilities will be as per their mutual agreement. This protocol has been made for the first time.

Due to several such provisions, there will be restrictions on misappropriation of money, transparency in fund’s utilisation, bring in financial discipline and immensely help in project’s timely completion.

Apart from this, many developers finance the project by mortgaging the land or flats or the entire project. Furthermore, they may divert funds from the project’s account without the knowledge of homebuyers. This lack of transparency could potentially lead to problems in the future for the project and buyers alike. Now, the promoter must declare the loans availed from any financial institutions against the mortgage of land or flats or the entire project. It will be mandatory for the developer to disclose the financial institution’s name, address, transaction date, sanctioned amount, withdrawn amount, balance amount, etc. The availed loan’s overall details along with amount utilized for construction should be certified by project’s Chartered Accountant with their UDIN number. It is only after following this process a developer can be allowed to withdraw the interest on loan.

Ajoy Mehta, Chairman, MahaRERA, “MahaRERA is committed to building trust among home buyers by legally empowering them to ensure their investments are secured and protected. MahaRERA has highlighted the legal rights of homebuyers in the housing projects concerning various crucial aspects such as parking, amenities, standardised agreements for sale, allotment letters, etc. To ensure financial discipline in project operations, MahaRERA has taken a crucial decision mandating opening of three bank accounts in a single bank for each of the projects. If a project involves more than one promoter, four bank accounts will be required. These measures will be effective from July 1. This move is aimed at having financial discipline and transparency in the managing revenue as well as expenditures related to project’s development, thereby enabling precise financial oversight in the real estate sector. Such a measure is expected to minimise potential delays in project’s completion, thereby benefiting homebuyers and enhancing the real estate sector’s credibility. MahaRERA is committed to fostering this trust.”

₹10 lakh crore debt sanctioned for real estate from 2018-23Also Read:

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Paradigm Realty, a leading developer having projects spread across Mumbai from Bandra-Khar and Santacruz to Andheri and Borivali, anticipates robust sales traction as the real estate market experiences a positive surge this Gudi Padwa. “This auspicious occasion holds significant cultural and spiritual importance, making it the perfect time for individuals and families to invest in their dream homes,” remarked Parth Mehta, CMD of Paradigm Realty. 

According to Mehta, in India, such moments are cherished for their auspiciousness, and coupled with enticing offers, they become even more compelling. “Gudi Padwa not only marks the Marathi New Year but also symbolizes new beginnings for countless individuals looking to embark on their homeownership journey. With expectations of a 15-20 percent increase in sales, this year promises to be exceptional,” he says. 

As part of its Gudi Padwa offering, Paradigm Realty has an exclusive offer of a 10-gm gold coin + 0% SDR along with a spot discount upon booking a flat at their 71 Midtown and Paradigm Alaya projects adding an extra layer of prosperity to this joyous occasion. 

For developers like Today Global, the festivities aren’t just about celebrating traditions; they present a golden opportunity to connect with customers on a deeper level and cater to their aspirations and lifestyle choices. 

“Home buying isn’t purely transactional; it’s linked to the happy sentiments of the consumer. People wait for these occasions to invest and make an investment of a lifetime. Festive offers act as catalysts, prompting them to finally realize their dream of owning a home. This Gudi Padwa, we are looking to introduce special payment schemes to make it convenient for the buyers to invest,” says Mr. Bhavesh Shah, Joint-Managing Director – Today Global Developers. The Navi Mumbai-based Today Global Developers recently handed over 300 Homes at ‘Codename Bellevue‘, placing them among the first developers at Upper Kharghar to do so.

Over the years, Gudi Padwa has emerged as a pivotal moment in influencing the sentiments of buyers in the commercial real estate sector. This auspicious occasion, also known as Ugadi or Chaitra Shukla Pratipada, heralds the onset of the Hindu New Year and is celebrated with immense zeal and fervor not only in Maharashtra but also across several other states in India.

The significance of Gudi Padwa in the realm of commercial real estate lies in its association with prosperity, new beginnings, and auspiciousness. It is deeply ingrained in the belief that any endeavor initiated on this auspicious day is destined for success and abundance. Consequently, many buyers perceive Gudi Padwa as a propitious time to make significant decisions, whether it involves purchasing commercial properties or investing in real estate projects.

Shakti Constructions, recognizing the significance of Gudi Padwa, has devised a comprehensive strategy aimed at attracting potential commercial property buyers. “As part of our Gudi Padwa campaign, we will offer exclusive promotions, discounts, and incentives through targeted marketing campaigns, virtual tours, and digital marketing strategies, highlighting the value proposition of owning commercial real estate in prime locations with excellent connectivity and growth potential,” says Navya Pahuja MD & Partner, Shakti Constructions. 

However, it’s not just about the deals and promotions; the project location plays a crucial role too. “Gated communities at upcoming locations with great potential of appreciation aregoing to be the key. All existing and upcoming infrastructure developments at Navi Mumbai including MTHL, Kharghar-Turbhe tunnel, airport, etc., are the key to property decisions made around Gudi Padwa,” Mr. Bhavesh Shah, Joint-Managing Director- Today Global Developers informs.

As developers strive to create not just residential spaces but communities where dreams are realized and legacies are built, Gudi Padwa serves as a poignant reminder of Mumbai’s resilience and dynamism. It’s a time when the city comes alive with renewed hope and optimism, and the real estate sector stands as a beacon of opportunity for all who seek to carve out their own slice of Mumbai’s vibrant landscape. As we embrace the festivities and look towards the future, Gudi Padwa symbolizes not just a moment in time, but a celebration of Mumbai’s enduring spirit of growth, prosperity, and possibility.

Also Read: Gudi Padwa to propel housing sales as offers galore

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·                A total of 1,947 acres of land was acquired by real estate developers across the country with a development potential of ~176 million sq ft.

·                The total value of these land transactions stood at INR 32,203 crore.

·                 Around 1,365 acres (~70%) was acquired for proposed residential projects with a development potential of around 130 million sq. ft.

·                These residential developments would likely have an estimated sales potential of INR 138,750 crore.

·                Delhi NCR led both in terms of number and area of land deals, with 415 acres acquired across 36 separate transactions valued at approximately INR 9,120 crore.

·                MMR had the highest transacted value of land at INR 11,222 crore which translates into average per acre transacted value of INR 39 crore.

The year2023 stands out as a record-breaking year for real estate across all asset classes reflected by the strong performance indicators of both demand and supply. As the real estate sector continues its journey on a steep growth curve, developers are building a robust supply pipeline by investing in acquisition of land across the country. A total of 1,947 acres of land valued at INR 32,203 crore in 111 separate deals were acquired by real estate developers in 2023 as compared to 1,603 acres in 2022 (valued at INR 18,112 crore), up by 21% Year-on-Year (Y-o-Y). The land acquired has a development potential of ~176 million sq. ft.

The average transacted value of land has touched INR 16.5 crore per acre in 2023, up by 46% as compared to the previous year. This staggering increase is attributable to higher land transactions in Tier 1 cities and established prime micro markets. In addition, Mumbai Metropolitan Region (MMR), the most expensive real estate market in the country doubled its share in total land area transacted in India from 7% in 2022 to 15% in 2023 and contributed significantly to this increase in per acre transacted value.

Tier 1 cities accounted for 65% of the total land transacted in the country. Developers are strategically acquiring land in both prime locations in the metro cities as well as entering newer markets and pockets of growth.

Land Transaction Snapshot-2023

Source: JLL Research

In 2023, Delhi NCR led both in terms of number and area of land deals, with 415 acres acquired across 36 separate transactions valued at approximately INR 9,120 crore. Select established players acquired multiple land parcels across Delhi NCR. Out of these 415 acres, around 264 acres (64%) valued over INR 5,300 crore was acquired in Gurgaon alone. This was followed by Noida with over 59 acres (14%) land being acquired valued at around INR 1,775 crore. Delhi, Faridabad and Sonipat contributed the rest.

Bengaluru followed Delhi NCR, with close to 305 acres of land acquisitions across 14 separate transactions valued at INR 3,412 crore. MMR saw 24 separate land deals spread over 289 acres valued at INR 11,222 crore – the highest in the country. This translates into average transacted value of INR 39 crore per acre, which is 2.3 X of the average pan India land value.  In Chennai, a total of 209 acres of land was acquired valued at INR 1,220 crore across 8 separate deals.

Other cities like Nagpur, Ludhiana, Ahmedabad, and Ayodhya experienced prominent developers acquiring land. Ludhiana led in terms of area acquired in Tier 2 and 3 cities with around 320 acres of land transacted.

 Source: JLL Report

Note: Delhi NCR includes NCT of Delhi, Gurgaon, Noida, Faridabad and Sonipat. MMR includes Mumbai, Thane, Panvel and Khalapur. Others include Ludhiana, Nagpur, Ayodhya, Ahmedabad, Dholera and Sanand. The development potential is estimated based on the permissible FAR/FSI allowed in the respective micro markets where the land has been transacted. Joint Development agreements (JDAs) are not included for the analysis. Only outright purchases by real estate developers are considered for the study.

The residential segment led the way in land transactions locked in the year 2023.

“With a surge in demand for housing, developers are actively acquiring land parcels for building future supply pipeline. Out of the 1,947 acres acquired in 2023, 1,365 acres (~70%) was acquired for proposed residential projects with a development potential of around 130 million sq. ft. These residential developments would likely have an estimated sales potential of INR 138,750 crore. The launches of new residential projects are expected to strengthen further through new land acquisitions in strategic locations and growth corridors” said Dr Samantak Das, Chief Economist and Head of Research and REIS, India, JLL.

Land Transactions Snapshot for proposed residential developments.

2023 was a bonanza year for residential markets as sales were up by 26% Y-o-Y. Highest ever annual sales of 271,800 units were recorded in 2023, surpassing the peak seen in 2010 at 216,700 units, by 25%. Residential launches in 2023 witnessed a growth of 19% Y-o-Y.

Going forward in 2024, we expect land transactions to remain steady with developers expanding their land banks on the back of expected moderation in interest rates, growing demand for housing and support from institutional funding agencies. Infrastructure changes, specially enhanced metro connectivity between various micro-markets, will throw up new pockets of growth within each city.

Also Read:MahaRERA and Advertising Standards Council of India (ASCI) collaborate to identify erring developers

The post Developers acquire a total of 1,947 acres of land valued at INR 32,203 crore in CY2023 appeared first on Square Feat India.

“Typically, Q4, marked by higher inclination of homebuyers to wrap-up property purchases in festive period and instantaneous liquidity benefit aided by developers offering attractive discounts, has historically provided the final push to residential activity.  Close to 40% of the annual residential units sold, achieve closure in the last quarter of the year. Industry consensus are indicative of 2023 housing sales already reaching close to 2022 levels and given the ongoing festive season, 2023 is likely to witness 20-30% higher sales as compared to 2022.”, saidBadal Yagnik, Chief Executive Officer, Colliers India

Quarterly housing sales breakup (%)

Source: Industry, Colliers

Note: Percentages are basis consensus of various industry estimates

Data pertains to top 8 cities – Ahmedabad, Bengaluru, Chennai, Delhi-NCR, Hyderabad, Kolkata, Mumbai & Pune.

Buying sentiment relatively undeterred by repo-rate changes

While home loan EMIs do have a role in swaying the home-buying behavior at the end-user level, the impact is less pronounced on aspirational buyers. At the industry level, a low correlation between home loan disbursements and repo rate changes establishes the fact that residential segment activity in India is more governed by the sense of identification and belonging that comes with home ownership, rather than fleeting financial gains brought in repo rate movements. Buyers with serious purchase intent are likely to stretch their budgets in purchasing homes that align with their desired identity and lifestyle.

Source: RBI, HDFC, Colliers

Further, it is pertinent to note that homebuying is a long-term financial commitment entailing present income levels, expected growth in income levels interspersed with prevailing interest rates and other benefits at buyers’ disposal.  On an average, a homebuyer goes through at least 3 business cycles during the entire tenor of the home loan and the benefits arising out of interest rate movements get rationalized over time.

“Consumers are well aware that repo rates and thus EMI variations even out over the long tenor of a home-loan.  Interest rate trends are cyclical in nature, making end-users less sensitive to fluctuations in interest payments over a 10–20-year period. Homebuyers are more likely to alter the location, stage of construction, ticket size, unit size, preference of developer and bouquet of amenities in the housing society, rather than hasten or delay the purchase decision itself.”, saidVimal Nadar, Senior Director & Head of Research, Colliers India.

Immediate & deeper liquidity benefits enthuse homebuyers

Sentiment buoyancy, in fact, played a pivotal role in the residential segment staying afloat during the peak years of COVID-19 pandemic in 2020 and 2021. In order to negate the likely adverse impact of the pandemic on housing purchases, various state governments stepped in with reduction of stamp duty and registration charges by up to 2%. In fact, homebuyers, nudged by the significant one-time monetary outflow reduction, purchased homes even in otherwise turbulent times marked by financial and economic volatility. Moreover, fence-sitters and investors, saw this as an opportune moment to invest in residential real estate be it for self-use, or for pure-play investment purpose. Even the second homes market witnessed significant traction in the COVID altered world, reaping in multiple advantageous factors such as increased focus on health & wellness, heightened demand for spacious homes and substantial reduction in transactional charges.

Circle rates and property guidance values, akin to the registration charges, determine the timing of property purchases to a large extent. A typical Indian homebuyer is likely to factor in such regulatory changes, more prevalent at the end of calendar or fiscal years and advance or abstain from outright purchases accordingly.

The ongoing festive season is all set to provide a further fillip to residential real estate that has been on an upswing all year. New launches, bumper discounts, tie-ups between developers and home furnishing firms, innovative payment schemes and targeted marketing campaigns, all are the current flavours of the season. The joyous atmosphere is destined to bring an emphatic conclusion to residential real estate in 2023 and lay the foundation for a stronger 2024 as well.

Also Read: Infrastructure upgrade to fuel realty in MMR

The post Festive push to residential real estate momentum of 2023 appeared first on Square Feat India.

• Avg. cost of debt saw yearly increase (7.96% in FY22) but remained lower than the pre-pandemic levels due to rising repo rates
• Net debt of top 8 listed developers remains stable at approx. INR 230 Bn in FY23 in comparison to FY22, but is 43% down compared to FY19
• Listed developer’s revenue collectively goes up by 7% on yearly basis – from approx. INR 281 Bn in FY22 to over INR 301 Bn in FY23; but it is yet to come back to pre-pandemic levels of FY20 (INR 329 Bn)
• Meanwhile, listed players’ sales share has grown from 6% in FY17 to 15% in FY23
• Sales by listed players grew from 57 Mn Sq. ft in FY 22 to 68 Mn Sq. ft in FY 23 – annual growth of 19%

The unfettered demand for housing across the country has enabled the country’s leading large and listed developers to reduce their debt, reveals an analysis of the financials declared by the top 8 developers [1] engaged in the development of residential real estate.

As per ANAROCK Research, the net debt of top 8 listed developers has reduced from INR 405 Bn in FY20 to over INR 230 bn in FY23 – recording a decline of 43% in the period. On yearly basis, the net debt of developers has remained almost stable in FY 23 as compared to the year ago period.

Source: Developers’ Investor Presentations & ANAROCK Research

 Anuj Puri, Chairman – ANAROCK Group, says, “This decline in net debt is essentially because of boosted sales and revenues. These developers’ sales volumes have surpassed pre-pandemic levels and are headed for a new peak. With improved cash flows over the last few years, their debt has reduced significantly. Interestingly, the widening gap between the gross and the net debt also indicates a comfortable financial position for these players. For instance, the difference between the gross and net debt of the developers was approx. INR 74 Bn in FY20 which has widened to almost INR 152 Bn in FY23.”

Meanwhile, the periodic interest rate hikes since April 2022 have led to a marginal rise in the cost of debt, though it remains lower than the pre-pandemic levels of FY20. This, however, will not impact large and listed players’ execution capabilities.

“The findings once again vouchsafe the increasing confidence of most homebuyers in projects by these developers, who have entered the new fiscal with stronger and healthier books and values,” says Puri. “Also, while the top 8 listed developers are on solid financial ground, large unlisted players are also displaying a similar trend.”

The market share of large unlisted companies such as ATS Green, GM Infinite, Myhome, Piramal, Runwal, Signature Global, Shapoorji Pallonji, Wadhwa Group, Provident Housing, Goel Ganga, and Casa Grande, among others. Cumulatively, the market share of large developers, both listed and unlisted, has nearly doubled – from 17% in FY17 to 36% in FY23.

Overall, as per ANAROCK Research, the last fiscal (April 2022 to March 2023) recorded sales of approx. 3.65 lakh units across the top 7 cities – the highest in the last 5 years. The first quarter of the current fiscal (April to June 2023) saw approx. 1.14 lakh units sold in these cities – the highest-ever quarterly sales recorded.

Also Read: Listed Developers Are Selling more Homes

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