12:34
Wednesday proved to be an important day for central government employees as the Union Cabinet cleared the implementations of 7th Pay Commission recommendations, which is expected to benefit to over 1 crore government employees and pensioners. Realty experts feel that the 7th Pay Commission will have a positive impact on the sector and provide opportunity to middle class government employees to own a house with the increased disposable income. Hike in salary indicates an increased spending power and better economic growth. The government has approved rise in salaries and pension for public sector employees.
The 7th Pay Commission recommendation will be effective from January 1 and the Cabinet will decide if the arrears for the six months have to be paid in one go or in installments.
The real estate sector is already reeling under pressure and revival looks tedious and a long drawn process. Developers are already offering discounts to get buyers back into the market. 7th Pay Commission’s is seen as a step that would boost the demand and home ownership sentiment.
“In 2015, the 7th Pay Commission’s decision to hike the salary of state as well as central government employees by almost 23.6% was seen to have a positive impact on the demand side of residential real estate, as it would boost sentiment for home ownership among a set of buyers who have traditionally been very conservative in matters pertaining to large financial commitments. The increase in demand would be uniformly seen across India’s more affordable cities. Pricier cities would not see much of an impact on this account, as this segment of potential home buyers will be looking primarily for budget homes, ” Ashwinder Raj Singh, CEO – residential services, JLL India said.
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