Realty sector on a high as it bucks pandemic blues

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By Ashish Mitra --
Thursday, 14 Jan, 2021

With its momentum picking up briskly amidst a renewed fervor, the Indian real estate sector was enjoying a cautious recovery in the beginning of 2020. And then, gradually, the pandemic swept across the nation changing the whole panorama dampening the expectations of realtors. It did not take much time for the property sector to comprehend the ruthlessness of this biological storm as its physical machinery went for a toss.

Housing sales nose-dived to almost 80 per cent in Q1 & Q2 2020 and construction activity came to a virtual standstill with a pandemic-induced nationwide lockdown. Key sectors like automobile, hospitality and tourism took a fair share of the blow throwing the economy into a disarray as its GDP contracted by 23.9 per cent in Q1 2020 and 7.5 per cent in Q2 2020.

While the economy unlocked in phases, financial crisis, piling unsold stock and flagging consumer sentiments, brewed the perfect storm for consolidation. Increasing supply constraints, migrant crisis, international trade restrictions and immobilized citizens also pulled the plug on the residential realty sector – the primary driver for India’s real estate growth.

Looking at flagging fortunes of the real estate sector and the ‘Housing For All’ mission deadline nearing, the Government of India pitched in with financial stimulus and incentivisation measures to haul the realty sector out of the abyss.

Understanding the sentiments of the realty sector, governments of Maharashtra and Karnataka brought in a reduction in stamp duty rates on transaction of immovable property to the tune of 2-3 per cent. This movement has perked up the mood of the realtors and jolted the realty sector back into motion as it helped developers to sell inventory and liquidate stocks that have been lying idle for months.

The extension of CLSS (Credit Linked Subsidy Scheme) for affordable housing from March 2020 to March 2021 with a liquidity boost of Rs 70,000 cr, last-mile funding of Rs 20,000 cr for stressed developers and an additional outlay of Rs 18,000 cr for PMAY, also brought the much needed relief to the flaccid property sector.

In addition to that, proactive government measures in the form of moratoriums, tax cuts, construction premium cuts and project timeline deferrals, helped sow green shoots of recovery for the property sector.

With gradual easements and increased sector buoyancy, real estate developers digitised their business modules to increase resilience and enable business continuity. This digital leap was a revelation for realtors as they could connect with homebuyers, drive transactions with convenience and make use of a limitless playground to showcase their inventory.
Realtors signed accords with digital realty platforms like Square Yards to make home buying simple, hassle-free, credible and transparent. It was a whiff of fresh air for homebuyers too as they interacted with a myriad of properties leveraging digital knickknacks like 3D walkthroughs & virtual tours and transacted seamlessly with multiple payment gateways and digital signatures.

Constant feedback from consumers about this neo-home buying experience helped developers to invent new business strategies that sync with the current consumer preferences and create the perfect alibi for the physical counterpart.

Housing sales across tier 1 markets shot up to 2x levels QoQ and new projects got sold out in two weeks, something that was last seen during pre-Covid days.

Looking at how this celluloid-like contactless home buying experience
e resonated perfectly with homebuyers, realtors spent exponentially on an array of tech solutions inducted digital tools and prepped themselves to the core to tackle the changing environment of the sector and expectations of the consumers.

While it’s true that the pandemic has accentuated the importance of owning a home bringing a larger sense of security, realtors witnessed higher demand this time since real estate investment became easier and more affordable, thanks to rock-bottom home loan rates, stunning payment plans and property price corrections.

Realty sector on a high as it bucks pandemic blues. With its momentum picking up briskly amidst a renewed fervor, the Indian real estate sector was enjoying a cautious recovery in the beginning of 2020. And then, gradually, the pandemic swept across the nation changing the whole panorama dampening the expectations of realtors. It did not take much time for the property sector to comprehend the ruthlessness of this biological storm as its physical machinery went for a toss.

Housing sales nose-dived to almost 80 per cent in Q1 & Q2 2020 and construction activity came to a virtual standstill with a pandemic-induced nationwide lockdown. Key sectors like automobile, hospitality and tourism took a fair share of the blow throwing the economy into a disarray as its GDP contracted by 23.9  per cent in Q1 2020 and 7.5 per cent in Q2 2020.

While the economy unlocked in phases, financial crisis, piling unsold stock and flagging consumer sentiments, brewed the perfect storm for consolidation. Increasing supply constraints, migrant crisis, international trade restrictions and immobilized citizens also pulled the plug on the residential realty sector – the primary driver for India’s real estate growth.

Looking at flagging fortunes of the real estate sector and the ‘Housing For All’ mission deadline nearing, the Government of India pitched in with financial stimulus and incentivisation measures to haul the realty sector out of the abyss.

Understanding the sentiments of the realty sector,  governments of Maharashtra and Karnataka brought in a reduction in stamp duty rates on transaction of immovable property to the tune of 2-3  per cent. This movement has perked up the mood of the realtors and jolted the realty sector back into motion as it helped developers to sell inventory and liquidate stocks that have been lying idle for months.

The extension of CLSS (Credit Linked Subsidy Scheme) for affordable housing from March 2020 to March 2021 with a liquidity boost of Rs 70,000 cr, last-mile funding of Rs 20,000 cr for stressed developers and an additional outlay of Rs 18,000 cr for PMAY, also brought the much needed relief to the flaccid property sector.

In addition to that, proactive government measures in the form of moratoriums, tax cuts, construction premium cuts and project timeline deferrals, helped sow green shoots of recovery for the property sector.

With gradual easements and increased sector buoyancy, real estate developers digitised their business modules to increase resilience and enable business continuity. This digital leap was a revelation for realtors as they could connect with homebuyers, drive transactions with convenience and make use of a limitless playground to showcase their inventory.  
Realtors signed accords with digital realty platforms like Square Yards to make home buying simple, hassle-free, credible and transparent. It was a whiff of fresh air for homebuyers too as they interacted with a myriad of properties leveraging digital knickknacks like 3D walkthroughs & virtual tours and transacted seamlessly with multiple payment gateways and digital signatures.

Constant feedback from consumers about this neo-home buying experience helped developers to invent new business strategies that sync with the current consumer preferences and create the perfect alibi for the physical counterpart.

Housing sales across tier 1 markets shot up to 2x levels QoQ and new projects got sold out in two weeks, something that was last seen during pre-Covid days.

Looking at how this celluloid-like contactless home buying experience 
e resonated perfectly with homebuyers, realtors spent exponentially on an array of tech solutions inducted digital tools and prepped themselves to the core to tackle the changing environment of the sector and expectations of the consumers.

While it’s true that the pandemic has accentuated the importance of owning a home bringing a larger sense of security, realtors witnessed higher demand this time since real estate investment became easier and more affordable, thanks to rock-bottom home loan rates, stunning payment plans and property price corrections.