India has been on the move with a ceaseless flow of policies in the present times. However, certain timeless milestones have stood out across decades. 70 years of independent India makes it worthy to reminisce the breakthroughs that have been an integral part of India’s Realty Sector.
1. Birth of Chandigarh & Gandhinagar
The contemporary prime cities of Chandigarh and Gandhinagar were established in 1952 and 1960 respectively. This was a first-of-its-kind extraordinary occurrence wherein exclusively new cities were planned in India.
2. 1st City Development Plan
The Maharashtra Regional and Town Planning Act, 1966, took the first initiative to consolidate the practice of progressive planning and town planning. The Planning Commission led the way in issuing the first directives for district planning in 1969. This propelled many states to devise district-level plans. Though these endeavors were not successful in reaping the desired outcomes, a few were par excellence.
3. Urban Land Ceiling Act
The Urban Land (Ceiling and Regulation) Act was legislated in 1976 to tighten the screws on suppositional rises in land prices in cities and adjoining areas and to provide affordable houses. Nevertheless, since it was not implemented well, the situation further deteriorated and there was unavailability of land for social housing and social infrastructure in cities and towns. Ultimately, this was invalidated in all states except West Bengal and Kerala.
4. Formation of institutions
The government began to launch establishments like the Housing and Urban Development Company (HUDCO) in 1970, City and Industrial Development Corporation (CIDCO) in 1971, the Mumbai Metropolitan Region Development Authority (MMRDA) in 1975, National Housing Bank in 1988 and the Housing Development Finance Corporation in 1994, to bolster the residential real estate sector.
5. Liberalization of Economy
In the milieu of an imminent financial deficiency crisis, India went through economic liberalization in 1991 by way of reforms. This set the ball rolling for modernization. This ushered in employment opportunities, and gave a boost to a big market of consumers, approach to multiple commodities and services for the first time. This opened new avenues of entry for multi-national corporations in a big way and created a unique kind of demand – cutting edge elite office space.
6. 1st property rotation
The era spanning 1994-99 underlined the culmination of India’s first step as a property market, which came into existence after liberalization reforms pushed up property prices for the first time, as a result of NRIs and foreign investment. Nonetheless, the real estate sector witnessed a deflation after 1995 because of characteristic incapacities. The Asian Financial Crisis of 1997-98 drained out foreign capital and brought growth in capital values to a complete standstill.
7. Commercial aerospace
The concept of making of airspace commercialized over transit pathways was first initiated at Vashi station in 1992. Other stations like Sanpada, Juinagar, Nerul and CBD Belapur, on the same railway line, replicated the Vashi way though they were not as successful. Yet, the recent modification of Seawoods-Darave railway station in 2017 has registered outstanding success.
8. Software boom in India
India’s rise as a world power in the software realm was recognized throughout the international arena, on account of the Y2K bug. This was a difference maker even in the real estate market. A lot many international firms began to put together offices in cities such as Hyderabad and Bengaluru, in the age that followed the Y2K period. This effected a growth in the commercial and home realty sector of these cities.
9. Real FDI in Realty Sector
Foreign direct investment (FDI) got approval first in the year 2005. This unfolded more pathways of financial backing that made the industry mature in terms of business practices and product incomings. The FDI sphere has been made more liberal in years lately, which has led to register private equity influx and admission of foreign developers.
10. The Era of Shopping Malls
With the rise of the new millennium, the first mall, Spencer Plaza, in Chennai, gave Indians a flavor of the concept of systematized retail. This was just the beginning. Mumbai came on the heels with Crossword and Delhi followed with Ansal Plaza. Since the beginning of 2000s, malls have been springing up all across the urban landscape of India.
11. Hi-tech Airports
The government gave a green signal to the remodeling and innovation of brownfield airports like the ones in Mumbai and Delhi as well as suburban airports like the ones in Bangalore and Hyderabad by way of the public-private partnership model in 2006. This caused the prologue of the concept of airport cities and airport playing a friendly neighborhood to real estate.
12. Fall of the Lehman Brethren
The fall of Lehman Brothers in 2008 stimulated a sub-prime turning point forcing investors to explore rational investments across asset classes. The economic slowdown that followed and risk employment made it tough for investors to come out of their stakes in Indian real estate. The global slowdown, nevertheless, hit commercial realty in India and a narrow effect on home real estate sector in India. Narrow means the price reduction led to quick sales and India’s home sector returned with a bang quicker than imagined.
The Real Estate Regulation (and Development) Act, or better known as RERA, has been enforced since May 1, 2017, to safeguard the interests of home buyers from being deceived by unprincipled developers. This relic Act will instill assurance in home buyers, equipped with knowledge and security in addition to eliminating frivolous actors vanish from the extremely disintegrated residential realty industry.
REITs or Real Estate Investment Trusts were first set up in 2014 to allow small-ticket investments in commercial real estate of the country. Given the expanding universe of Grade-A office properties in Indian cities as well as rising rentals across their micro-markets, REITs offer an attractive way to investors to trade in prime commercial real estate.