While Indians go out to vote in the world’s largest voting exercise, the real estate market is eagerly waiting for the outcomes of India’s general elections.
The activity in the property market in India has slowed down in the lead up to what is being described as the most consequential elections in India’s post-Independence history.
Over the last few quarters, political uncertainty has considerably weakened buyer confidence in many regions, says Venkat Iyer of India Real Estate Forum based in Australia.
“A decisive win for any of the alliances will fortify the outlook of the homebuyer and the property market will see a return of buyer demand due to the boost of confidence,” says Venkat.
“Post elections, if the road to recovery is unhindered, property buyers may very well re-enter the market in good numbers.
However, Venkat’s response is very cautious. “At present, the key factors at play on the Indian real estate are unsold inventory, absorption and interest rates. It is unlikely that these factors will change immediately post polls, regardless of which party wins.
“Over the longer term, what will matter most to the real estate sector are a hard relook at FDI in housing, REIT legislations and the effective implementation of Real Estate (Regulation and Development) Bill.
However, it is not just the political stability that will decide the course of progress for the property market.
“With the incoming government, there are other economic contingencies like employment, interest rates and infrastructural changes (motorways, new connectivity, rail projects etc.) that will have a substantial effect on the Indian real estate market.
Venkat is hopeful that whoever wins the elections will follow through on their election promises. “All the political parties are making strong assertions that their leaders will deliver continuous years of prosperity through active growth and development plans. But the real impact and competence of any new changes is something that only future can tell!
Venkat is appealing to Indian voters to vote diligently. “If India truly wants to become a developed nation and drop the tag of a ‘third world’ or a ‘developing nation’, citizens need to choose a leader who promises and delivers clean and transparent governance with a people-centric approach.”
India has gone to vote on 7 April. More than 814 million people — a number larger than the population of Europe — are eligible to vote in the world’s biggest democratic exercise. Voting will be held in nine stages, which will be staggered until May 12, and results are due to be announced on May 16, 2014.