New Delhi, 28th July 2021: Real estate continues to be the preferred asset class for investment in the wake of the COVID-19 pandemic, but majority of homebuyers want discounts along with flexible payment options as an incentive, according to the Housing.com and NAREDCO survey.
The real estate portal conducted the survey between January to June this year of more than three thousand consumers.
According to the survey findings, real estate is the preferred mode of investment for 43 per cent (35% last yr) of respondents, followed by stocks 20 per cent (15% last yr), fixed deposit 19 per cent (22% last yr) and gold 18 per cent (28% last yr).
“The health crisis has reinforced the importance of home ownership across the world. As a result, the residential real estate market is not only witnessing fresh demand from first time homebuyers but also from a lot of consumers who are upgrading to bigger apartments,” said Mr. Dhruv Agarwala, Group CEO, Housing.com, Makaan.com and PropTiger.com.
“This demand increase generated post COVID, aided by rock bottom housing prices and historically low interest rates on home loans, has helped residential real estate developers to successfully navigate through the tough economic situation caused by this pandemic,” Mr. Agarwala added.
Commenting on the survey findings, NAREDCO President & Founder & MD Hiranandani Group, Dr. Niranjan Hiranandani said: “while emphasizing on the fact that the demand for Housing is inherent, he opined that, “Value of owning a home has been reinforced by the Covid 19 pandemic crisis with the renewed preferences. Integrated township living will garner traction as it offers holistic lifestyle all at one stop destination and also offers work near home opportunities. As the economic recovery is scaling up gradually in backdrop of festive tailwinds, buoyant capital markets, softening of home loan interest rates, record high foreign reserve & FDI increasing employment rate and optimistic demand impetus. Slash in GST and Tax benefits will go long way in strengthening sustainable demand and built on signals positive consumer confidence index for H2 FY 21-22”.
Among other key findings, the majority of the respondents (71 per cent) feel that flexible payment plans and discounts will provide much-needed financial aid during current times and drive them to make purchase decisions.
Strong housing sales in Maharashtra’s two key markets– Mumbai and Pune — suggest that stamp duty reduction by the state government did play an important role in stimulating demand during the September 2020 to March 2021 period.
“Builders’ margins for under construction properties have reduced due to increase in construction costs and land prices in some cities. Therefore, there is little scope for reduction in basic selling price (BSP). However, builders have been offering flexible payment plans and discounts in some cases to attract customers,” said Mr. Mani Rangarajan, Group COO, Housing.com, Makaan.com and PropTiger.com.
“The housing market has shown great resilience during the second wave of COVID infections with demand and supply both growing during April-June 2021 compared to same period last year. The survey shows that buyers’ sentiments have improved since June and people have started searching properties with renewed vigour. We expect demand to remain strong during the festive season,” Mr. Rangarajan added.
Mr. Rangarajan stated that State governments should reduce stamp duty on registration of properties to encourage homebuyers.
The survey found that economic and income outlook for the coming six months is more optimistic as compared to H1 2020.
The sentiments have been less impacted this year given that uncertainty is lower as compared to last year. Also lockdowns have been more selective along with vaccine availability.
“While the second wave did see homebuyers shying away from making a purchase, subsiding coronavirus cases has seen buyers resume their home searches a lot quicker than after the previous lockdown period,” the report said.
As expected, prospective homebuyers are now taking into account nearby healthcare infrastructure for selecting a property.
Recreational spaces and daycare centres have also made it to the list of top amenities that buyers look for.
With corporates adopting work-from-home and hybrid work policies, homebuyers are expressing interest in looking for larger homes.
Traffic on real estate portals for searching properties has gone up due to an acceleration in the use of digital tools during this pandemic.