General Elections and the Real Estate Connection
  • A new government with a clear majority raised optimism in 2014
  • Nearly 0.54 million units launched in the year and nearly 0.34 million units sold - previous year saw launch of about 0.46 million units and lower sales
  • Long-term benefits of recent reforms will accrue only with the continuity of their enforcement by this or the next government
 
During any impending general elections, real estate stakeholders conjecture exhaustively about the likely impact on the real estate market. Conventionally, the period between the announcement of the election date till the final result day is a period marked by caution and hesitancy in the overall real estate market.
 
While investors generally refrain from making market plays in this waiting period, buyers may also adopt a wait-and-watch stance. The reasons can vary from anticipation that a newly elected government may offer more sops to homebuyers to the hope that a re-elected government may reward voters with such sops.
 
In this period, developers understandably prefer to focus on selling their unsold stock rather than launching new projects. The time leading up to general elections is decidedly favourable for homebuyers as they can do some hard bargaining with developers who need to sell units for more liquidity.
 
Overall, it is a period when all stakeholders wait with bated breath for the final outcome.
 
It is no secret that in the past, funds parked by political parties in real estate were sucked out of the system to finance their poll campaigns – and the market is currently facing a serious liquidity crunch. 
 
Though new laws now overtly cap the amounts that political parties can accept for campaign donations, they obviously do not cover all possible avenues of access. In any case, the period leading up the upcoming election could prove to be stressful for the overall real estate market.
 
It certainly bears watching if the current Government remains in power to finish the work it has started in reforming the Indian real estate sector, or whether a newly-elected government will hold on to the baton of change and take it to the next lap.
 
The overall macroeconomic environment after the general elections will play a pivotal role in deciding the fate of the Indian realty sector in 2019 and beyond. For the sector to remain healthy and see wholesome growth, a stable government at the Centre is a must. Also, the current growth momentum must sustain and not slow down.
 
ANAROCK data suggests that 2014 (the year of the last general elections) saw the maximum launches and absorption across the top seven cities, with nearly 0.54 million units launched during the year, and nearly 0.34 million units being sold. The previous year witnessed fewer launches (about 4.6 lakh units) and lower sales. 
 
The fact that the new government came to power with a clear majority raised optimism, and the improved sentiment resulted in both sales and new launches picking up.
 
However, with the spate of industry-shaking policies that followed thereafter, new launch and sale numbers declined. Each new policy announced by the current government brought its own kind of disruption to real estate, and the sector has not yet recovered completely from the ensuing confusion.
 
Thus, despite a stable government in power, reformatory changes with indubitably favourable long-term implications dealt severe blows to the real estate sector in the short term. Their long-term benefits will accrue only with the continuity of their enforcement by this or the next government.
 
(Anuj Puri is chairman of ANAROCK Property Consultants)
 
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    Paytm Extortion Case: Sonia Dhawan’s Bail Rejected by Noida District Court
    Paytm’s former executive Sonia Dhawan, who was in jail for almost four months, has been denied bail by the Surajpur Noida District Court. She is former secretary of Paytm Founder and Chief Executive Vijay Shekhar Sharma. 
     
    Ms Dhawan was arrested in October along with her husband Rupak Jain, who is a property dealer, and Devendra Kumar, an employee of Paytm, for trying to blackmail and attempting to extort Rs20 crore from the Paytm founder. The three had been charged with theft, extortion, cheating, criminal breach of trust and conspiracy. 
     
    As per an article written by the online publication Entrackr, adequate evidence has been found against Ms Dhawan during the investigation. “Her active involvement in the crime has come to light. As she along with her husband and other co-accused has committed a serious crime of a grave nature, the court can’t grant her bail application,” the report says. 
     
    Interestingly, two weeks ago, Rupak Jain, husband of Ms Dhawan was granted bail by the Allahabad High Court due to lack of proper evidence and is expected to walk out free on 20 February 2019. Similarly, there is no trace of a bail application being filed by one of the accused, Devendra Kumar. 
     
    Ms Dhawan is alleged to have passed on data to a fourth man named Rohit Chomal, who is the prime accused in the case. He is believed to have made the extortion call to Ajay Shekhar Sharma, senior vice president of the company and brother of the Paytm founder. Mr Chomal, however, has gotten a stay on his arrest by the Allahabad High Court. 
     
    In light of the above, Ms Dhawan’s lawyers are expected to move her application to the Allahabad High Court. 
     
    Ms Dhawan still maintains her innocence and claims she never stole any confidential data and nor did she threaten Ajay Shekar Sharma or Vijay Shekar Sharma regarding the alleged extortion. In her bail application, she was quoted saying, “There is no independent witness against me. I have been implicated in collusion with the police with the objective of spoiling my career.” 
     
    Adding another twist to the case, Manoj Kumar Pant, who was probing the Paytm case was recently arrested for allegedly taking bribes. He was arrested along with three journalists. 

     

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    SBI to Waive Outstanding Loan of 23 CRPF Soldiers; Expedite Release of Insurance Money to Next of Kin
    State Bank of India (SBI) has announced a special initiative for the Central Reserve Police Force (CRPF) soldiers who martyred in a dreadful terrorist attack in Pulwama in Jammu & Kashmir (J&K). This includes expediting release of insurance money to next kin of the martyred soldiers and waiving off loans of 23.  
     
    In a statement, the lender says, "All the CRPF soldiers were customers of the Bank under defence salary package where the Bank provides insurance of Rs30 lakh to each of the defence personnel. Bank is taking steps to expedite release of insurance money to the next of kin of the martyred soldiers."
     
    "23 soldiers had also availed of loans from the Bank and the Bank has decided to waive off all the outstanding loans with immediate effect," SBI added.
     
    Rajnish Kumar, chairman of SBI said, "It is extremely distressing and disturbing to witness the loss of lives of the Soldiers who always stand for safety of our country. In this moment of grief, our sincere thoughts are with the families of our brave hearts. These initiatives by the Bank is a small gesture towards the families who have faced irreparable loss."
     
    The lender has also made an appeal to all its employees to voluntarily contribute towards the cause through Bharat ke Veer, https://bharatkeveer.gov.in, a dedicated portal from the Union Home Ministry.
     
    SBI has also created a UPI for the Bharat Ke Veer initiative to help people make their monetary contributions easily.   
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