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The Pune Residential Realty Report (PRR) from Jan to June 2019 has promising news for the Pune Real Estate Sector. According to Mr. Rohit Gera, Managing Director, Gera Developments Pvt. Ltd, after a slump that lasted a few years, Pune Realty is making a comeback with many positive market indicators such as increased construction, higher sales, new project launches, decrease in unsold stock, and slowing pace in reduction of home prices as well as improved inventory projection (less than 10 months). But he does see the continuing liquidity challenge in the real estate sector as an obstacle to further progress.
Here are some important takeaways from the PRR for first time home buyers:
Increased tax exemption
Increased tax exemption of INR 1.5 Lakhs has been provided to buyers on home loans under affordable housing in the union budget 2019. This additional deduction is substantial and is for loans that were sanctioned between 1st April 2019 and 31st March 2020 for homes priced at and below INR 45 Lakhs and where the owner does not own a house at the time.
Higher inventory & Resumption of on hold projects
After declining for almost 2 years the construction activity has picked up again which means good news for home buyers who have booked their homes but have faced delays in delivery. It is estimated that almost 24000 home buyers who are stuck with incomplete/on hold projects can look forward to better delivery timelines with resumption in construction. Increase in inventory compared to last year also suggest that the market has expanded in the last six months in terms of construction activity. Some micro markets, in Pune real estate, with highest inventory for sale include Dehu, Alandi, Bhosari Pradhikaran, Kanhe, Talegaon, Somatne Phata, Charholi, Gahunje, Kiwale, Tathawade, Wagholi, Hinjewadi, Undri, Mohammadwadi, Balewadi, Mahalunge, Kondhwa, Chakan, Pisoli, Manjari, Wakad, Lohegaon and their surrounding areas.
New launches at a 2 year high
In Pune city, new project launches have increased significantly indicating optimism among the developers. There has been a 56% rise in the new projects launched as compared to 2018 with data suggesting that home buyers are moving up the value chain and more consumers are opting for value, premium and premium plus properties as compared to budget homes. In response to this trend, most of the new launches are in the Premium Plus Segment. This is good news for customers interested in luxury, premium housing as they will have more options to choose from.
The data for 2019 shows that demand and supply are close to being in balance with inventory sold being replaced by new inventory. In 2019 10 new projects account for 15% of all new supply launched as compared to 2015 where only 7% of new unit launched were accounted for. For home buyers this means that there is more choice in newer projects than choosing from older, in-progress projects.
Market prices at 5 year low & increase in affordability
With the average Pune market prices at a 5 ½ year low this is the best time period for first time home buyers looking to invest in a property. Also, in the last few years home loan rates and property prices have trended down whereas disposable incomes (especially among the middle and higher middle classes), have risen, placing home affordability at an all-time high. Favorable market conditions combined with rising salaries has meant that the same home buyer can now afford a bigger property than before.
Increase in sales & Fall in inventory overhang
The overall realty sales have increased by 19% as compared to 2018 with most units sold in the premium plus segment followed by budget and value homes. This indicates that the trend among customers in the Pune real estate market is towards premium residential properties. Increase in sales has also resulted in an improved inventory overhang from 12+ months to less than 10 months.
Overall, after a long downward cycle the Pune residential property market is looking positive with price stabilization, improving sales, increasing number of new launches and decrease in unsold stock. This bodes well for first time home buyers as it affords them better buying options at affordable prices. Combined with RERA implementation (ensures transparency, timely delivery, payment flexibility for buyers) and the tax exemption announced in the union budget of 2019, this time period is favorable for first time home buyers and developers hoping to boost sales.
A reputed brand in the Pune Real Estate Sector, Gera Developments Pvt. Ltd. Have, for decades, created premium Residential and Commercial projects that have surpassed customer expectations. Staying true to their reputation of offering unique features in their homes, they are offering Gera’s Song of Joy, a residential project of ChildCentric™ 2 & 3 BHK apartments in Kharadi. Conveniently located a few minutes away from EON IT park and other commercial business hubs, Gera’s Song of Joy offers meticulously planned, spacious, stylish & luxurious, ChildCentric™ 2 & 3 BHK flats for sale in Kharadi Pune. So, if you are in the market for a strategically located, premium home with a hassle free buying experience combined with a 5 year warranty on construction, then look no further than Gera’s Song of Joy. Click the link for more information.
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