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 a survey by Housing.com and Naredco.
The real estate portal conducted the survey between January and June this year of more than 3,000 consumers.
According to the survey findings, real estate is the preferred mode of investment for 43 per cent (35 pc last year) of respondents, followed by stocks 20 per cent (15 pc last year), fixed deposit 19 per cent (22 pc last year) and gold 18 per cent (28 pc last year).
“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 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,” Agarwala added.
Naredco President Niranjan Hiranandani, while emphasising on the fact that the demand for housing is inherent, said, “Value of owning a home has been reinforced by the COVID-19 pandemic crisis with the renewed preferences.”
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 Mani Rangarajan, Group COO, Housing.com, Makaan.com and PropTiger.com.
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 acceleration in the use of digital tools during this pandemic.