Home buying during Covid 2.0

Known for being one of the few stable and ever-growing real estate markets, Hyderabad has been home buyers’ first preference. With Covid-19 second wave, will it remain unaffected?
To build confidence among homebuyers during Covid 2.0, the Times of India conducted a webinar with real estate industry experts of Hyderabad. Held on 29th May 2021, the webinar discussed current trends in Hyderabad’s residential real estate, investment, home buying sentiments, housing demand and the impact of the ongoing pandemic on this industry.
The panel of experts included V Aditya Reddy (Executive Director, Sri Aditya Homes), Ravinder Reddy ( Chairman, Janapriya Group), Dayanand reddy (Director, TNR constructions), Abhishek Chanda (Director, Vasavi Group), Nanda Kishore (Managing Director, Ramky Estates and Farms Limited), Sandip Patnaik (Managing Director, Telangana & Andhra Pradesh, Jones Lang LaSalle), R Suresh Kumar (Senior Vice-President, Business Operations, Prestige Group Hyderabad), and Sumanth Reddy (Immediate Past President, National Association of Realtors, NAR).

Covid-19 second wave has brought an unforeseen halt in the market, leaving many prospective residential real estate buyers and investors directionless is the popular perception.
Enhanced interest in home buying
Industry leaders, in unison, expressed that the Hyderabad market is witnessing a visible surge in interest with regard to home buying.
“Approximately in the past three years, there has been a 30-40% hike in the prices of residential properties in Hyderabad. About 70-80% of flat buyers in Hyderabad are from the software industry, and their salary bracket is approximately from Rs 6 lakh-18 lakh (with nominal annual salary hike). Regardless of such facts, the importance of home has suddenly dawned upon them, and they are going ahead to own one,” states Sandip Patnaik, Managing Director (Telangana & Andhra Pradesh), Jones Lang LaSalle.

Virtual Conclave on Building Confidence Among Home Buyers During Covid 2.0- Youtube link
Demand for bigger homes
In Hyderabad, big, expansive, and green homes are the most preferred, fast-moving units. Many have called it a Covid-induced demand. Is it temporary or a sustainable trend? “With the continuation of WFH and online education, people are home-bound. They have realised the importance of a capacious space. A major chunk of home buyers is upgrading to a bigger space (primarily from 2BHK to 3BHK) with better social infrastructure and recreational facilities. Such demand will continue to grow,” believes Sumanth Reddy, immediate past President, National Association of Realtors (NAR).
Emphasising the most dominant consumer base of Hyderabad’s real estate and what they need, Abhishek Chanda, Director, Vasavi Group, opined, “It is mostly the middle and upper-middle class. Driving factors behind a purchase include investment as an asset, a status symbol, social security etc. Meanwhile, some buyers don’t mind buying a smaller home, provided it is within a high-rated gated community and equipped with great amenities. Areas such as East and North Hyderabad are witnessing such buying patterns.”
Covid 2.0
We had also witnessed how the onset pandemic brought an exodus of construction workers, leaving many projects incomplete. Is it going to repeat? “During this second wave, the labourers and workers are much more sensitised about how to follow protocols. Realtors are also ensuring the safety of the workers at the site. Thus, one can expect that project delays won’t be very long-drawn,” explains R Suresh Kumar, Senior Vice-President (Business Operations), Prestige Group.
Third-wave and price drop
“The first wave had a prolonged impact. The second wave is shorter comparatively. If at all the third wave hits, it will be very short-lived with almost no adverse impact on Hyderabad’s real estate. Already, there is not much cushion or margin in pricing for the developers. Thus a drop in property price is very unlikely to happen,” states Nanda Kishore, Managing Director, Ramky Estates and Farms Limited.
Affordable housing- a reality?
The demand is high, but the city is yet to have any major projects. The restriction is on the area, not pricing. “The average unit area sold in other metro cities is 1000sqft, whereas in Hyderabad it is 1700 sqft. Having said that, one can’t deny the huge potential the local market has for affordable housing. There are challenges for developers, particularly the cost of construction. But the good news is that a few players are foraying into it,” shares V Aditya Reddy, Executive Director, Sri Aditya Homes.
Suggesting a few smart tips, Ravinder Reddy, Chairman, Janapriya Group said, “High-salaried employees (Rs 20 lakh per annum and above) must look at a unit in affordable housing as a second or third home for rental purposes. One must exercise home loans available at all-time low-interest rates and buy a home under this category as an investment and sell-off in five years. It will earn them lucrative returns.”

Wait or buy without delay
“Blessed with an ever-evolving infrastructure and lifestyle, Hyderabad stands out. The cost of a home in a city like this is a steal deal. It is a buyers’ market. The demand for housing would never deplete. One wouldn’t get a more opportune time than this to buy a home,” stated Dayanand reddy, Director, TNR constructions concluding the webinar.