5 Major changes in the real estate market in 2017

Owning real estate is playing a major role in people’s life as, in addition to being a good investment, it signifies status and wealth. The advantage with owning real estate is that you can use it for your own benefit or rent it out to whoever you want for as long as you want.

This is the reason why any changes in the real estate market have profound effect on the economy. These changes are controlled by latest trends and vary from year to year depending on various factors.

Here are the 5 major changes in the real estate world in 2017:

More foreign investors

Since the boom in the Indian real estate industry has begun, its peak seems to be everlasting. There was a time when the market had only Indian investors but as it becomes one of the largest real markets in Asia, the Indian real estate market has started to attract some major foreign investors.

Iconic investors like the Fosun International Limited, Altico Capital, Apollo Asia RE Singapore Limited, Ivanhoe Cambridge etc., have begun to show interest in India’s real estate market. This increase in foreign investors has opened new doors in the market, both in terms of number and quality of available space.

Hybrid spaces and co-working spaces

Hybrid or co-working spaces are common spaces used by people or institutions not operated by the same company. In simpler terms, different companies or individuals that do not, often but not necessarily, share the same work profiles, work in the same area. It is usually utilised by freelancers, start-ups and smaller companies.

It is an effective way to utilise space and get what you need at an affordable price. Such work spaces are also called ‘Hybrid’ spaces and the market for these is on the rise at a great speed. Investing in such Hybrid spaces is a great asset.

Affordable housing gets Infrastructure status

This was introduced in the Union Budget of 2017 where in it was approved that affordable housing will be given a revamped and increased budget so that ‘Housing for all by 2022’ initiative may be made possible. What this means is that by granting this project infrastructure status, the developers will be allowed access to foreign funds by means of debt at a cheaper price, and getting loans will be easier.  Under this scheme, 1 crore houses will be built in rural areas to house the poor.

Intra-industry consolidations

There are various tiers in the real estate industry. These include land owners, investors, developers, suppliers, workers, etc. Each level has various sub-levels depending upon their size and operating financial investment.

So, you will find large investors, small landowners, medium sized developers etc., all operating within the same industry. The latest trend in this aspect is the consolidation of small players with larger key players making this crowded area more organised. The larger holders are slowly but steadily acquiring and merging with the smaller holders and this has increased efficiency and profits for everyone involved.

 Introduction of Real Estate Investment Trusts (REIT)

REITs are companies which allow you to invest in real estate without actually having to buy properties. They do this by shareholding system, where in the shareholders benefit by owning stocks. These REITs are said to be focused on the regular income streams. The large equity fund conglomerate, Blackstone, is one of the major players said to be waiting to start an REIT. REIT investments can be found not only in housing industry but also in hospitals, malls, hotels etc.

With the introduction of REITs, the market is said to grow immensely opening new avenues for investment and subsequent returns, making it a popular venture.

These are just a few major changes that happened recently in the real estate industry. To make safe investments, it is important to know the latest rules and trends which are operating the market.