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Trends of Real Estate Sector in 2021

Posted by Balaji on February 9, 2021

The real estate sector has gone through many uncertainties in the wake of Covid-19 in

2020. But there are positive signs in the year 2021 and the industry is looking to

overcome the chaos of 2020, with a number of positive steps taken by the government

to revive the real estate sector. Here we will discuss the factors that will impact both

the real estate sector and home buyers in 2021.


Property prices are likely to be constant

Many experts believe that year 2021 is the best time to invest in a house. Low-interest

rates, unsold inventories due to construction delays, and distress to the sector caused

by Covid-19 these factors will certainly have a significant impact on the property

prices. As Global investor and author Ruchir Sharma pointed out in an interview on

January 9, 2021, he says, “Great time to buy a house taking a fixed-rate mortgage

because interest rates are likely to increase over the next few years,”


Low-interest rates to propel housing demand

In its bi-monthly monetary meeting held on December 4, 2020, RBI kept the repo rate

to 4 percent unchanged for the third time in a row in an effort to boost the industry.

Prior to that, the repo rate for the months of March and April 2020 was 4.40 percent. A

clear and visible impact on most banks’ home loan rates was the result of an

unchanged repo rate. In the second half of 2020, the rates were reduced to 6.75 to 9

percent from the highs of 8.05 to 12 percent in January 2020. Buyers looking to

benefit from the low-interest rate must hurry up.


Reducing stamp duty charges to boost housing demand

In a bid to increase housing demand, Maharashtra was the first state to reduce stamp

duty to 2% from 5% in-effect till Dec 31, 2020, and 3% from January 1, 2021, to

March 31, 2021. Madhya Pradesh also cut off stamp duty to 1% from 3% for urban

areas and Karnataka to 2% from 5% in an attempt to boost the housing demand.


Easy payment option and discount for home buyers

The real estate sector is currently looking to overcome the headaches of 2020, the way

is to provide customers good deals and easy payment options to buy a house. Easy

payment options will also attract new home buyers and people looking for a good

investment option will definitely take the opportunity. As it is the best time to invest in

a house, home buyers looking for a good deal on payment options don’t have to go too



Union Budget 2021

Finance minister Nirmala Sitharaman during her budget speech announced the

extension of the tax holiday for one more year for affordable housing projects. These

projects can avail of tax exemption benefits until March 31, 2021, she said.

The Finance Minister announced a tax exemption for an additional year under the third

pillar of the Aatmanirbhar Bharat project, which includes financial inclusion for all, with

the goal of ensuring affordable housing for all. The government announcement may

boost the housing sector in India.

In 2020, real estate has experienced many tumults, but the future looks bright and the

sector is poised to rise at an impressive pace in 2021, contributing to the country’s

overall economic growth.

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