What the election means to the average property seeker BY RAI UMRAOPATI RAY

Indian home buyers believe that a Congress-led government would be most sensitive to the housing needs of the ordinary Indian

By Rai Umraopati Ray

The last few years in government has bought the Congress some favour amongst property buyers, as the party narrowly skims ahead of the BJP in a survey conducted by makaan.com between 22nd to 30th April 2009. According to the results, 37 per cent of the respondents gave the Congress-led UPA the thumbs up when it came to housing needs. About 34 per cent said that a BJP-led coalition would do a better job with the housing segment. Nearly 25 per cent of the respondents were non-committal and felt that none of the above coalitions would do any good to the sector and four per cent thought that a Third Front-led coalition would give the real estate sector a boost.
When this data is broken up city wise, it throws up some interesting insights. For instance, in Kolkata, despite having the Third Front as a majority party for almost two decades, 45 per cent of the respondents felt that a Congress-led alliance would be the right choice for the Indian realty sector. Echoing sentiments that have been prevailing in the national capital over the last few years, the Congress beats the BJP by a 5 per cent margin, garnering 40 per cent of the affirmative vote amongst Delhi respondents. Mumbai sounds a warning bell to the BJP — despite the upheavals and discontent against the Congress-led state government, Mumbaikars still have a soft corner for the Congress when it comes to housing reforms with 35 per cent voting in favour of the UPA. While Ahmedabad with 51 per cent respondents is more hopeful that a BJP-led coalition would boost the realty sector, Bengaluru and Pune follow Ahmedabad with 42 and 37 per cent of the respondents voting for the BJP respectively. About 33 per cent of Mumbaikars seem to be indifferent to either of the above parties at the centre.
Interestingly, the survey says that property seekers are upbeat about the fact that property prices would fall further after the elections, however most seem to think that a BJP-led government would mean a steeper fall in prices. “Prices could come down if the BJP resumes power and could shoot up if the Congress remains at the centre,” feel survey takers. In anticipation of the forthcoming government taking steps to improve the realty sector, property buyers at present are taking a more cautious approach. Fifty one per cent of the survey takers are willing to hold back their realty purchases until a new government comes into power. A sizeable population (40 per cent) are ready for immediate investment and 9 per cent of the total respondents were undecided. City-wise breakups reveal that 57 per cent of the property seekers in Hyderabad were willing to hold back their property purchase till the elections were over. Mumbai, Ahmedabad and Delhi follow Hyderabad with 54, 52 and 51 per cent waiting on the sidelines respectively. Property seekers in Kolkata were more decisive as 48 per cent of the property seekers in Kolkata seemed ready for immediate investments.
When given a choice Indian property buyers said that lower interests on home loans should become the top priority for an incoming government as 40 per cent of the respondents’ felt that the government must bring down interest rates on home loans to around 5-7 per cent per year, in order to spur property sales. Twenty eight per cent of home seekers felt that the new government should boost affordable housing and 19 per cent felt that the right to property should be made a fundamental right. Another 13 per cent believed that income tax exemption on the payment of home loan interest should increase from 1.5 lakh to 3 lakh.
The survey points out that affordable housing has emerged the need of the hour with the majority of property seekers looking at affordable homes. About 36 per cent of the respondents felt that the government should exempt all homes costing under Rs 30 lakh from registration fees, 30 per cent believed that land should be provided at subsidised rates. Another 19 per cent suggested that the development of satellite cities as viable residential options would help boost the segment and 15 per cent felt that the government should put a five year lock-in period to promote end user sales.
Since buyers from lower and mid level income groups flood the Indian property market today, makaan.com analysed the demographics of these respondents. While the lower income group preferred the Congress-led coalition, the mid level income group favoured the BJP. A majority of members from the income group of Rs 7 to 25 lakh pa., showed a clear leaning towards the BJP, while those from a lower income group (less than Rs 7 lakh pa) showed a preference towards the Congress-led coalition.