Interview:Covid has led to influx of offers among realty players for consolidation: Bhaskar-Wadhwa Grp

Due to Covid, there is a huge influx of offers in the last 6 months among real estate developers for consolidation. Realty players are also expecting input tax credit under the new GST regime. In an free-wheeling exclusive interview with, Bhasker Jain, Head – Sales, Marketing & CRM, The Wadhwa Group talks about various issues and concerns for the real estate sector in the country. Here are the excerpts: 

Q1) What are the expectations from the festive season this year? Will it be at par with last year?

Every year the real estate sector witness positive sentiments flowing in the market during the festive season which further spike the demand for good projects. Moreover, the lucrative festival deals offered by developers attract the home buyers resulting in better sales during this period. Currently, the majority of developers are focusing on better value propositions such as furnished homes and easy payment plans to cater to hassle free experience and the liquidity issues of customers. 

Also, home loans interest rates are at an all-time low and with reduction in stamp duty, the sector should get a much-needed boost as we enter the festive season. From an NRI perspective, exchange rates could be an added advantage to generate sales. This in fact is the best time to buy a home, for those who have been thinking of owning a home.    

Q2) What are the expectations from 2021?

This year, due to the lockdown, the sales volumes were affected but users are coming back as things are opening up. The residential segment looks very promising in the current scenario of Covid 19 as many people including the young generation are now looking to own a house rather than be dependent on rental accommodation. Customers have now realized the importance of a well-planned, well designed and a well-ventilated home during the pandemic more than ever before. These factors will help drive demand and boost sales in the festive season and will be a key in ridding the sector of the ills caused by the virus in the forthcoming year.

Q3) When can we see consolidation in the Indian real estate industry in major way and how bad/how good will it be?

Definitely, consolidation has accelerated after Covid and only reputed players will sustain. The stressed developers are looking for trusted developers who can deliver on time and are financially stable as well. From the last 2-3 months many proposals have come from the stressed developers and it is still ongoing. 

Since last few years many developers are coming to us to take over the projects, however it is true in last 6 months the influx of such deals has increased in some or the other form. 

Q4) What are the changes required from the governments’ side (regulations) that will remove bottlenecks and give further boost to the sector?

Timely start & completion of projects has always been a concern, and a single window clearance will help to swiftly execute projects making it a win-win situation for developers and homebuyers. Industry status for the sector and single window clearance for projects has been a long-standing demand which we expect the Government to address.

We would also like to see revival of the input tax credit under new GST regime which will help to keep the property prices under control.

While incentives have been provided to boost the affordable housing segment, there needs to be a reduction in the cost of land, development premiums to incentivize developers to build budget homes. The Government also needs to allocate more funds for Pradhan Mantri Awas Yojana (PMAY) which will help them achieve the target of ‘Housing for All by 2022.