Real estate sector
The burgeoning real estate sector in India demonstrated unwavering resilience in the face of the Covid shock, which hit the sector last year. Despite early setbacks, the sector quickly adjusted to the new normal with digital methods and was soon back on track. Sales increased rapidly during Q3 and Q4 of 2020, indicative of a strong growth forecast until April 2021.
The second wave of Covid spread has undoubtedly disrupted the steady upward growth trajectory, and partial lockdowns and movement restrictions will undoubtedly have an impact. However, the real estate sector is well-prepared this time around with tried and tested methods, so the pause will only be temporary. Market sentiment is also being boosted by mass immunization campaigns and an improvement in the recovery rate.
When signs of revival appeared in early 2021, a silver lining appeared. According to Knight Frank, sales of residential properties in eight major cities increased 44 percent from January to March this year to nearly 72,000 units as demand recovered. Trends also show that 80 percent of prospective buyers want to buy a house within the next year, with 65 percent preferring ready-to-move-in houses in 2021. Low interest rates, favorable government policies, flexible payment plans, simple investment opportunities, and the use of technology have all played important roles in propelling this growth.
Demand larger homes
In these ever-changing scenarios, new trends emerge on a regular basis. The work-from-home culture is likely to persist, and people will continue to demand larger homes. Tier-2 and tier-3 cities will see an increase in demand as people look to buy homes in their hometowns. High-rise apartments, gated townships, and luxury towers with well-managed infrastructure will continue to dominate the ultra-luxe segment, which is driven by NRIs, UHNIs, ex-pats, and business leaders. Interest rates have reached an all-time low, and the RBI’s rate cuts have increased demand. Buyers have been able to proceed with their purchases as a result of this trend. The real estate market has always been a favorite of investors and a buyer’s market. This sector offers better returns and will continue to attract investors through 2021.
Buyers will want to avoid having to wait for their properties, so ready-to-move-in spaces will be in high demand. These properties are safe investments that eliminate market risks. Under-construction properties take time, and in a fast-paced world where buyer preferences change rapidly, ready-to-move-in spaces have become an appealing offer. Digitization will be critical to the growth of the sector in the market. Property sellers and buyers have embraced digital methods of communication, research, and purchase. Online, negotiations, searches, and inquiries are taking place.
These trends are likely to evolve and persist in the coming days in preparation for a digital future. Trusted developers with the solid financial backing and a track record of success will gain a larger market share. A developer who combines emerging trends with their preferences via technology is in demand by consumers. Customer-centricity will become the norm, eventually leading to higher levels of customer satisfaction.
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Property prices expected to rise as the economy recovers as vaccines become available. As foreign investors continue to show strong interest in quality assets in India, the sector’s confidence is apparent. REITs will continue to be a key theme and gain traction in the market as investment opportunities become more accessible. During this pandemic, Indian real estate has proven resilient, attracting investors’ attention. As soon as the pandemic is over, the segment will undoubtedly be a key pillar in bolstering India’s economic growth.