Here’s what govt plans to boost realty sector, job prospects

By: |
Published: January 5, 2020 6:46:48 PM

Abraham said the traditional centres of real estate including Mumbai, Bangalore and NCR domain will generate maximum employment in the real estate sector.

Also, he said, models like co-working and co-living spaces are gaining solid traction.

Buoyed by multiple reform measures undertaken by the government for the realty space, experts feel such steps will help in reviving the sector and generating more employment opportunities. At the same time, some of them also expressed concerns over liquidity situation and said that subdued demand may keep performance of residential realty projects muted. “There was a recent government announcement of Rs 25,000 crore special window to provide funding to stalled housing projects to revive the sector and also to help in terms of incremental jobs, that is, employment generation, revival of demand for logistics, cement, iron and steel industries and many other adjacent industries, Sudeep Sen – head of industrial, manufacturing and engineering vertical, Teamlease ServicesTeamLease Services – told PTI. These measures, he said, will attribute a growth of 11 to 12 per cent in the sector in the next 6 to 8 months.

Funds will now be used to provide priority debt financing for the completion of incomplete or stalled housing projects in the affordable and middle-income housing sector, Sen said. On jobs front, he said the main hiring will be a mix of unskilled labour workforce (loaders, carpenters, welders, fitters) and also support function profiles, the likes of site supervisors, tele-callers, account executives, customer support staff and sales executives.

Maintaining a negative outlook for residential segment and stable outlook for commercial real estate, rating agency Icra in its report had stated that liquidity crunch and subdued demand is likely to keep performance of residential realty muted.

Prices, however, are likely to move on a downtrend, driven not only by the continued focus of developers on keeping average ticket sizes affordable, but also by the high inventory overhang and overall sluggishness in demand, the Icra report added. However, commercial real estate will benefit from robust demand and favourable tailwinds from successful listing of first domestic Real Estate Investment Trust (REIT), the report said.

Michael Page India Director Nitin John Abraham said that even as the traditional housing sector is struggling due to a funding crisis and unsold inventories, which should see some movement, but commercial real estate is gaining momentum year on year and will show double digit growth this year as well. Also, he said, models like co-working and co-living spaces are gaining solid traction.

Abraham said the traditional centres of real estate including Mumbai, Bangalore and NCR domain will generate maximum employment in the real estate sector. However, cities like Hyderabad, Pune and Ahmedabad will also create jobs in the sector, he added.

Executive search organisation GlobalHunt Managing Director Sunil Goel said traditionally the real estate industry used to live and make money on spikes but the policies like RERA and large pool of availability of the units will make the industry consumer driven. “This is good for the sector because this is not beneficial to few developers only, and the sector may get converted from an investor portfolio to an end customer portfolio,” he said. The large number of transactions will create a greater number of jobs and will also bring growth to the sector compared to 2019, Goel added.

Do you know What is Cash Reserve Ratio (CRR), Finance Bill, Fiscal Policy in India, Expenditure Budget, Customs Duty? FE Knowledge Desk explains each of these and more in detail at Financial Express Explained. Also get Live BSE/NSE Stock Prices, latest NAV of Mutual Funds, Best equity funds, Top Gainers, Top Losers on Financial Express. Don’t forget to try our free Income Tax Calculator tool.

Next Stories
1Revenue Secretary steps up action against tax evaders; taps into data analytics to boost revenue
2Further escalation in US-Iran tension may affect India’s exports: FIEO
3Govt plans quarterly, half-yearly financial statement reporting norm for unlisted companies