Realty heading for consolidation, likely to see revival by 2019
The industry saw two game-changing developments in the form of the implementation of the Real Estate Regulation and Development Act (RERaD Act) and the Goods and Services Tax (GST). Implementation of both will improve the compliance and transparency levels within the industry. The relatively stronger player stands to benefit from these changes over the longer term.
Real estate sector, grappling with multi-fork regulatory and policy reforms, is expected to head towards consolidation. Outlook for residential real estate is likely to remain grim, while commercial real estate will be stable, according to industry analysts.
In last one and half years, regulatory changes such as implementation of the RERA, introduction of the insolvency and bankruptcy code, demonetization and GST may have impacted its operational performance. Nevertheless, these reforms will prepare ground for organized developers and also help affordable housing projects to gain momentum.