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Buying a home in Kerala now is an early bird catch

Buying a home in Kerala now is an early bird catch

Published:26 August 2018

# Our business correspondent

The banking sector's involvement is bringing a positive change. People once again started turning to banks for financing homes or land assets. Since most of the buyers are individual users price also has attained some stability.

Kochi | Gone are the days when a prospective home buyer or a calculated builder both remained skeptical and confused when drawing lines closer to a deal in real estate sector, thanks to a financial dilemma evolved post demonetisation last year, which prompted stakeholders in the sector to keep fingers crossed for long.

Villas and Flats partially completed or partially occupied remained skeletons in the cupboard out of a disaster, triggered by the Note ban and subsequent shock of GST, for many developers who ventured into a sector that witnessed a decade long continual boom prior to last one year. Now a sigh of relief seems to flash through the dark corridors, gaining momentum.

Prominent brands that had temporarily shelved their projects elsewhere in townships and suburbs gradually started redrawing their last lines. The mood of revival is evident after a year's time spent looking at shallow waters that left a large chunk of potential business undone, for a new 'Game of Thrones' to start with. To those who feel the market pulse, a fresh enthusiasm is trickling in.

As the festival days of Onam are nearing ahead, a ray of hope prevails in the property market with fresh purchases coming up. Though nobody expects an immediate surge in prices. Industry moguls analyse that a price boom should follow only after the leftover businesses of past year's getting cleared. Keeping this, new projects are expected to hold enhanced price tags for the coming fiscal.

Crude oil price hike that directly helped the Gulf countries, a falling rupee as an advantage for NRIs, lending rates to remain almost steady in an election year are the positive triggers for the property market to see a trend reversal. Prospective buyers only are in the market for recent. Rather than falling prey to a hyped up marketing strategy customers are attracted to a closer and confident approach showcasing strong fundamentals.

A report from Liases Foras - Independent, Non-Brokerage Realty Research Company suggests a speedy revival is taking place, leaving behind the chaos and turbulence surrounded the property market over several months reflecting a near total recessive slow down.

Real estate business in Kerala on a revival path: Sreeni Parameswaran

Real estate business in Kerala is on a revival path:
Sreeni Parameswaran of Shwas Homes

Kochi based Shwas Homes Managing Director Mr Sreeni Parameswaran has convinced with the banking sector's involvement in bringing a positive change. People once again started turning to banks for financing homes or land assets like before. Since most of the buyers are individual users price structure also has attained some stability.

The largest growing segment in the portfolio is below 60 lakhs asset classes. This segment achieved 20% more growth rate in the state. While homes in the range of one crore to two crores also achieved a significant growth of 13%, the 'less spent cheap home' concept remains out of attraction. Since any home loanee is an investor in that asset class, creditors prefer value purchases.

In terms of valuation a low cost purchase below 25 lakhs in Kerala does not match with that in other states due to varying land cost parameters. Taxation rules in Kerala exempt those homes with a carpet area below 60 square meters only from the luxury tax. Making use of several central government subsidies now available is an option for the low cost buyer group.

Builders see growth potential in new projects: V Sunil Kumar of Asset Homes

Prominent brand in the realty arena Asset Homes puts hopes in their new projects. A slow pace in overall sales was not a hard nut to crack for branded assets like our's: says Asset's Managing Director Mr V Sunil Kumar. "Despite setbacks like Currency ban or GST we always had our business. While clouds of confusions leave, the sector is more transparent and trustworthy at present".

Domestic buyers/investors are the new trendsetters

Mr Sreeni Parameswaran of Shwas Homes grins about the sales strategy of yesteryears when on completion of projects, developers had to traverse Gulf countries to find their buyers. Now Gulf money is not the only choice. Domestic buyers are emerging with fat bank cheques ready to support any asset purchase.

"Real estate in the state is purely in its growth trajectory. Be it an investor eyeing up good profit in the future or a usage oriented lifetime owner, the Kerala market is healthy to live up to their dreams. I could see a reasonable growth in the budget homes segment in near future. There may be some price spurt. This is happening mainly because of a demand-supply imbalance" Mr Sreeni Parameswaran told metrovaartha.com.


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