How COVID – 19 Has Changed The Real Estate Market of India?

by Anurag Gupta Real Estate Consultant

The entire world is doing its best to control the adverse effects of COVID – 19 and to contain it. Businesses in all the countries have received an oppressive halt which forced the financial agencies to cut their growth estimate for the sake of the global economy. When there happens something worse to the entire world, experts count on making predictions on its after effect. Hence, different opinions are evolving on the impact of the CORONA virus on real estate.

In today’s scenario, when the CORONA virus pandemic is showing its adverse effects on the world, experts are calculating its future impact on the Indian real estate too. The outbreak of COVID -19 has enforced a global health emergency which made the whole country in a lockdown condition. This,in turn, has imposed the first time ever and the biggest of all time worldwide WFH (work from home) experiment. Experts suspect that this may put a question mark on the importance of office spaces in the future Corona-eliminated world.

Impact on the housing market of India

Indian economy is set to go back for a record of 11 years due to the Coronavirus outbreak! Presently, PM has announced the 21-day lockdown to seize the loss of lives. Experts fear that this may further deteriorate the condition of the third-largest economy of India. Research agencies also suspect of a near-term pause in the development of Indian real estate. Several data collected from PropTiger.com say that in 9 major cities of India, housing sales have been reduced to 30% from the actual count from October to December of the last year. And, the festive season failed to drag consumers this time. The entire housing projects of India are suspected of having large-scale delays.

Impact on Indian builders & homebuyers

In the recent past, the government has launched several measures many times to recover the realty market growth which often made little impact on the Indian home buyers. For example, the government has reduced the GST for affordable properties to 1%. The official heads of the real estate agencies are expecting more such efforts from the government to encourage more buyers to invest in Indian real estate. According to the property builders’ prospect, the Coronavirus pandemic has appeared in a very sensitive time for the realty calendar. This is the time when balance sheet restructuring and statutory payouts happen. So, they asked the government to make some economic involvements again.

Impact on Indian office spaces

On the contrary to housing properties, counts of office space deals got an increase of 27% in the last year. Even a report published by Knight Frank shows that it was the highest of all time and the count crossed the bar of 60 million ft2. This counts as a noteworthy growth indicator for the office space realty market in today’s condition of financial slowdown. But it is suspected that the rate of utilization of office spaces may fall due to the success of today’s continued worldwide remote working.

Impact on Indian mall developers

In today’s 21-day lockdown scenario, shopping malls completely closed. So, Corona anxiety has resulted in footfall in Indian shopping malls. What if this situation continues for long? Experts suspect this will cost the mall-owners a lot, even the bank relaxations will not be able to do much to their help. In the post-Corona world, people will take time to throng into public places like shopping malls so footfalls in the malls will require time to increase.

Hence, it can be said that due to the Coronavirus outbreak, housing sales may drop in the count but the property values may not experience any significant changes.