- By Honey Katiyal
The Indian Government on August 5 created history by revoking Article 370 and 35A that grants special status to Jammu and Kashmir. The landmark decision that bifurcates the state into two separate union territories i.e. Jammu & Kashmir and Ladakh has not only brought a big cheer to the whole nation but has also opened a new gateway for the real estate market and investments in the country.
Till now, Article 35 A has stopped outsiders from acquiring any land or carrying out real estate investment in the state. But, now the history has bygone and post this announcement, the hilly and the serene land may witness a surge in investment. It may be in residential, commercial, retail or hospitality segments.
The significant move of scrapping the long-prevailing Article 370 has opened floodgates of many potential opportunities in these depressed property markets which were lacking behind in property prices as well as lucrative investments. Deterred private investments, shutting out of job opportunities has curtailed the economy of J&K leading to slow growth.
Because of this, being a tourist destination, the economic growth of the two cities was far behind from their counterparts or other Tier-2 cities. Moreover, the non-allowance of investing in immovable property by non-residents was another keynote challenge that was the part of Article 35 A.
All this will now be addressed once the changes will be ratified and smoothly taken up by both UT. But, then as said that every new move comes with some special attention. Although the face of the realty market will be going to change, investors and the realty developers must take cautious steps before entering into the market as it is too early to predict the future.
With problematic geography and unstabilized socio-political situation, the residential and commercial market may take some time to catch up the momentum. But, with organised infrastructural developments in segments like hospitality, tourism, entertainment, and retail the above real estate segments may sooner attract better investment opportunities.
Such moves will also create a positive impact on the depreciating property value and prices prevailing for years in both Jammu and Kashmir. Some of the prime localities have not even seen a jump in the price from a decade. So, the removal of the restriction on property buying and selling will further appreciate the price of land parcels and buildings in these prime localities.
Furthermore, apart from the government policies like a strict RERA, the local investors have to come up and build a strong real estate network to enhance the investors’ confidence. The growth model of other tier-2 cities where the local investors attracted big developers and firms to add thrust to their property market is a perfect example. Following the same model, even these two hilly states can in the future become an investment hotspot for HNIs and NRIs who always look to invest in scenic surroundings and lucrative markets apart from mid-level buyers.
The future of the real estate market is bright in both Jammu and Kashmir, but the investors must not get swayed away by this. A pragmatic approach is very much necessary to achieve returns and earn a profit from these distressed markets.