Real Estate Sector Fully Prepared To Fight With Third Covid, Let’s Find Out How?
It’s been just a month that the real estate sector of India has emerged from the second wave of the merciless pandemic. This trillion-dollar industry was at the pity of the lockdown in 2020 & 21 that brought chaos and spelled terror in the real estate market. Even as the real estate market bounced back to routine supported by govt impetus and incentives, a brutal second pandemic wave has captured the sector again, menacing to disrupt its much-expected revival.
The recovery of the realty sector post covid has been energetic and hopeful. After a superb performance in Q4 2020, the realty sector continued its revival in Q1 2021 with property search volume in different micro-markets in India moving constantly skywards. Demand for residential & commercial properties has exceeded pre-Covid levels and supply is going up with a growth of 8% everywhere.
The dramatic climb of the covid cases in entire India as second wave and a challenging vaccine rollout was the biggest worry of a real estate developer. Interruption in construction activity all over India due to temporary partial lockdowns will delay new launches and extend project possession deadlines.
And now Central & State Governments are preparing for the third wave of covid, but real estate investors and developers haven’t panicked yet because they learned from the worst. They have adopted all required measures and formulated actionable solutions through careful planning over the months to stick out any approaching crisis.
But still, new investors & home seekers are in dilemma, that what happens if the third wave of Covid occurs. For them here we have some insights on why the third wave of covid won’t many hurdles to the real estate sector this time.
- Consolidation of the property market with top developers: The realty market post-covid is in the safe hands of reputed real estate developers with deep pockets. These top developers in India with strong balance sheets, strong digital infrastructure, comprehensive implementation capabilities have received the trust of millions of investors & home buyers, leading to good transactions which aided the real estate sector to stand again on its feet. Since all other real estate developers have transferred their businesses to strong developers, the supply side is solid, supported by the increasing preference of homebuyers for the best homes from top brands of the real estate industry. With unaffected demand for residential properties still hot, these real estate giants will market their inventory aiming at particular segments at reasonable prices.
- Demand for mid and affordable housing segment still high: The residential market is experiencing a noticeable shift in the behavior of home seekers with regards to the importance of homeownership. Demand for residential properties has not plateaued in the face of the second Covid wave with buyers rushing to invest in residential properties with consideration on future capital appreciation. The continued growth in sales presents obvious signs of buyer self-confidence and people’s need for luxury homes, backed by reduced flexible spending, stable residential prices, attractive payment plans, and incentives from real estate developers. This has sloping the scale in favor of well-known developers.
- Developers alert about unnecessary credit and oversupply: A huge inventory in residential properties and levels of credit from financial institutions are two disagreeable things that had given real estate developers restless day & night. Major real estate players have thus remained careful on debt and concentrated on inventory liquidation to lessen leverage. Intending to become debt-free, property developers have become cautious about launching new residential projects to align supply with the current buyer demand. While aiming at the incentivized affordable housing bracket, real estate developers are offering more options to cut unsold stock while keeping their balance sheets complete.
- Online transactions to keep both buyers & sellers happy: The residential property sector has endeavored into a world of digital irreversibility. The digital background of the real estate sector, high on technology, has brought Video calling visits, 3D walkthroughs, virtual interactions, secure payment gateways to make the home-buying process trouble-free, wonderful, and safe. Real estate builders have seen how online transactions have taken them out of the difficulties previously and are thus advancing more in digital payments & site visit methods to smoothen the homebuying process.
- Homebuyers have complete trust in reputed developers: With the residential property market in the control of reputed real estate developers, demand for luxury homes will continue in the background of the third wave and will remain in the next coming years. This is because investors & buyers have full confidence in big brands like DLF, Tata Housing, Shapoorji Pallonji Real Estate, Godrej Properties, etc. and prospective buyers know very well that they will get the keys to their new homes on or before time. There is a movement of transparency in the property market. With RERA and other reforms perfectly applied in the real estate market, homebuyers today don’t have to worry about anything. Reputed real estate developers on the other hand will take care that they meet the expectations of buyers by keeping property rates within reasonable limits.
On a final note, it’s fair to say that the third covid wave won’t have any opposing effect on the real estate sector as it stands on a solid footing of recovery and will be able to deal with any temporary slowdown if any. Demand for affordable and luxury homes will remain since it’s a buyer’s market with property value remaining still and government incentives to continue. This will support the real estate sector to maintain an optimistic attitude and keep the real estate sector sustain in tough times.