Buyers flock to market as homes become affordable, developers sweeten deals this festive season

Having taken a big hit during the initial months of the lockdown, real estate in India has again started doing well, which is evident from the growing demand and rising sales, especially in the housing segment. Various studies undertaken by property consultants recently point towards this fact.

A quarterly analysis of India’s 8 prime residential markets by PropTiger.com, for instance, has revealed that the third quarter of 2020 saw primary residential sales to the tune of 35,132 units, recording a growth of 85% from the bottomed-out preceding quarter. Similarly, as per a study by ANAROCK, housing sales are all set to rebound to 90% of the pre-COVID-19 levels (Q1 2020), and the top 7 cities of the country may cumulatively witness a 35% jump in residential sales during the ongoing festive quarter (October-December) as against the July to September period.

The buoyancy in residential real estate may also be because developers — like earlier years — have pulled out all the stops to attract buyers during this festive season. And discounts and offers currently available juxtapose very advantageously with the rock-bottom property prices and home loan interest rates. Buyers are aware that such a fortunate confluence of advantages is unlikely to repeat itself in their lifetimes.

Industry experts say that it may seem like a paradox, but the pandemic has actually catalysed housing demand rather than suppressing it.

“COVID-19, in fact, has underscored the importance of owned homes because these are the only properties over which we can exert complete control. Also, the lockdowns and ensuing WFH (Work From Home) movement have caused our homes to double as offices – and rented homes do not permit many of the kind of changes that need to be made to recreate a genuine office setting. The home has become the centrepiece of our lives in many ways. Moreover, the financial uncertainties that arose from the pandemic have put empty, non-returns-yielding rental outgo under the spotlight. It is much more preferable to invest regularly in an owned home which provides a lifetime of safety and freedom from not only rent but the whims of landlords,” says Santhosh Kumar, Vice Chairman, ANAROCK Property Consultants.

Developers say that as the Indian economy limps towards normalcy after the lockdown, the real estate sector has been quick to adapt affectively in times of the crisis despite challenges.

“Festivals in India are considered the most auspicious time and a harbinger of prosperity and new beginnings. It is an opportune time for buyers to invest in a property and Central Park has seen a trend of a surge in sales during the festive season. Likewise, we expect the festive season this year to witness an increase in demand for residential properties as well,” says Amarjit Bakshi, Chairman and Managing Director, Central Park.

The depreciating rupee coupled with a conducive ecosystem at home such as low interest rates on home loan EMIs will motivate genuine buyers to purchase homes. “For a majority of home buyers, this is the most-awaited time of the year for buying a home that also coincides with bonuses and cash entitlements at the workplace. Not only buyers but also developers leverage this golden opportunity and come up with festive offers to attract consumers,” adds Bakshi.

Pankaj Bansal, Director, M3M Group, says, “The pandemic affected the real estate industry for a short term. However, with Unlock 5.0, re-strategizing business models and project launches have set the pace for recovery. As the festive season approaches, consumer sentiment would be strong and since we have offerings in all the spectrums — under construction-residential and commercial; delivered-residential and commercial — we are poised to cater to the customer needs.”

It may be noted that M3M recorded Rs 225 crore of sales in the first weekend of having announced their ‘Port Your Property’ campaign in October 2020, and is aiming for sales of Rs 5000 crore till December 2020 in the view of the festive season.

Karan Kumar, Chief Marketing Officer, DLF Ltd, says, “We foresee renewed interest in the upcoming festive season against the backdrop of the depreciating rupee, and low interest rates on home loans. All of these have improved attractiveness of real estate as an investment asset class against other traditional alternatives. Also, the recent RBI decision to rationalize the risk weights on home loans and linking them to LTV ratios will ensure more credit to borrowers, thereby giving a fillip to demand. The festive season, coupled with a number of recent measures by the government, and offers from developers, hopefully will nudge investors to make their decision during this period.”

Developers say the festive season is an opportune time for homebuyers. This year, a blend of demand and supply-side enablers, low rates of interest on home loans and government-aided recovery augur well for homebuyers.

“We have an omni-channel approach, where we are using both traditional and new-age mediums to put our vision across potential homebuyers. We also use a mix of all major social media platforms for lead generation, which have been giving us fruitful results. With travel taking a backseat due to Covid-19, people are now more inclined to invest in their future rather than looking at anything else. Hence the growth prospects of real estate are looking positive this festive season,” says Ashish Sarin, CEO, AlphaCorp.