Page 16 - BF Cover February 2019

HOUSING

New metro rail project to boost housing demand in Rs 1 Lakh crore granted

Noida, Greater Noida
for Affordable Housing
Housing demand and prices may rise in Noida as well as Greater Noida with the
To boost affordable housing and
launch of a new metro rail service, linking the twin-cities in western Uttar achieve the vision of Housing for All
Pradesh, according to real estate de-
by 2022, the government have un-
velopers and con- sultants.
dertaken several initiatives, such as
The new metro rail service, called Aqua Pradhan Mantri Awas Yojana
line, runs through 21 stations -- 15 of (PMAY) that aims to build 1 crore
them in Noida and six in Greater Noida homes in urban and rural India by
-- and covers a dis- tance of 29.7 km. 2022.
"The upgrading of infrastructure due
to metro connec- tivity is expected to Affordable housing has also been
help in spurring the demand for residen- accorded
tial units in the region. Also, it is expected to have positive fallout on the com- infrastruc-
mercial and retail segment as well," says Abhinav Joshi, Head of Research for ture status,
CBRE India. In the past also, Joshi said, metro lines have played a crucial role in ensuring
uplifting the real estate profile of areas that it connects. Realtors' body CREDAI that devel-
said that sectors along the Noida expressway will have better connectivity now. opers in this
segment have access to cheaper
"Commutation will become easier from places like Noida Extension too. The
loans.
market works on sentiment, and the sentiment is positive in the real estate
sector," said Prashant Tiwari, President of CREDAI western UP. With improved The Credit Linked Subsidy Scheme
infrastructure, he expects demand and rates for properties in Noida and Greater for the Middle Income Group (CLSS
Noida region to get a big boost. for MIG) was announced by Prime
Rating agency ICRA maintains negative outlook for resi- Minister Narendra Modi on Decem-
ber 31, 2016 and was earlier ex-
dential real estate, stable outlook for commercial realty tended twice till March 2019.

ICRA has maintained a negative outlook for the residential real estate (RRE)
segment due to high inventory, weak affordability and muted demand and a The government in the last week of
December 2018 extended the in-
stable outlook for commercial real estate (CRE) segment.
terest subsidy scheme till March
The RRE has witnessed a prolonged down cycle owing to high inventory, muted 2020 for first time to urban home
demand, weak affordability and declining investor interest. However structural buyers whose annual income is be-
changes over the last two years in the form of implementation of Real Estate tween Rs 6 lakh and Rs 18 lakh.
Development and Regulation Act (RERAD Act) and Goods and Services Tax (GST),
along with increased government focus on affordable housing, have raised ex- Till now, over 93,000 people from
pectations of demand revival in the industry, ICRA says in its year-end assess- this income group (MIG) have
ment of the real estate sector. It also notes that a broad-based recovery in de- availed the Rs 1,960 crore interest
mand across the country appears to be some time away. States such as subsidy from the Centre, which has
Maharashtra and Karnataka which have seen relatively better implementation been disbursed through banks.
of the RERAD Act are benefiting from increasing confidence of end-users, it says.
Overall, until December 30 this
Demand in the premium and luxury category of residential segment are likely year, around 3.39 lakh beneficiaries
to remain suppressed for under-development projects due to the increasing
have availed the CLSS under the
preference for completed properties under the GST regime. New project PMAY (Urban) and the total subsidy
launches had been severely curtailed in the calendar year 2017 due to the im-
released was Rs 7,543 crore.
pact of demonetisation and transition issues in RERAD Act implementation.

16 | 2019 | FEBRUARY | BANKING FINANCE