New Delhi: The Indian real estate sector is out of the woods.
The realty market, which came to a standstill in 2020 due to the coronavirus pandemic and the first wave of lockdowns, has shown indomitable resilience and is poised to move ahead in 2021, with the government supporting developers and introducing various schemes and relaxations. Pitching to present.
The market entered 2021 with caution and worry as the pandemic was still rampant across the globe. The situation in India was no different. The real estate sector emerged from the nationwide lockdown with resilience, damage-limiting skills and a new way of visualizing the business environment.
A key point of 2021 for the Indian residential real estate sector was that business did not stall despite the second wave of the pandemic. This indicates that the learning curve induced in the pandemic years has led to better business practices and a stronger housing market overall.
Reports showed that the realty sector has made a strong rebound and housing sales in seven major cities have grown two-fold to 62,800 units during the period July-September 2021.
Some market analysts have pointed out that the return of the Indian residential real estate sector after the second wave in the second quarter of 2021 was unprecedented and V-shaped.
Between January 2021 and September 2021, 1.63 lakh units of new residential supply were added in the top seven Indian cities, up 27 per cent over the 2020 full-year supply, and 1.45 lakh units were sold, compared to the whole of 5. percentage is higher. of 2020.
According to a report by Anarock, 1.28 lakh units of new residential supplies were added across the top seven cities of India in 2020, while sales stood at 1.38 lakh units. There was a 77 percent drop in supply and 60 percent in sales from the previous peak in 2014. This massive drop indicated that the residential market had bottomed out in 2020 and was likely to enter a long-term upcycle from 2021 onwards.
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The Indian real estate sector has also witnessed some significant changes. This sector has been going through a transformation in the last few years. However, the pandemic has accelerated its course.
Recently, Deloitte Touche Tohmatsu India LLP (Deloitte India) released a report titled ‘The Reality of Realty in a Post-COVID-19’, which captures the trends that will pave the way for the sector’s recovery . The report said that the pandemic has changed consumer behavior and this is one of the factors enabling the sector to bounce back.
Around 74 per cent of the respondents expect the demand for the residential sub-sector to increase, of which 86 per cent indicated a growth of 10-20 per cent.
With WFH and online schooling becoming the new normal, the demand for larger homes was higher and as a result, the mid segment (units priced between Rs 40 lakh – Rs 80 lakh) and the high end (units between Rs 80 lakh) 1.5 crore) performed well, a report by Anarock revealed.
Requirements to own a house, lower home loan costs, and different repayment plans of developers helped in property purchases, registering the highest number of sales during the July-October period.
Highlights of 2021
Technology Adoption: The real estate sector has now become a digital-first sector.
Rational rate hike: Unlike earlier, developers now hike prices in a disciplined manner, mainly to compensate for rising input costs. They are aware of the fact that any unreasonable price hike will disrupt the demand cycle. Between Q3 2021 and Q3 2020, prices increased by about 3 percent.
End User Driven Markets: About 85 percent of home buyers are now end users, and investors have more reasonable return on investment (ROI) expectations.
Demand for big houses In the past two years, demand for homes has grown large enough to accommodate work from home (WFH) and e-schooling realities, and the average size of new unit launches has increased by 26 percent.
Non-apartment section: Along with apartments, plotted developments and huge demand for villas has prompted many developers to increase their focus on the non-apartment segment.
Luxury and Ultra-Luxury Segment: As the net worth of the target group for luxury offerings was not severely impacted by the pandemic, buyers closed deals to take advantage of market conditions (slow demand, reduced stamp duty, developer discounts).
More launches in the suburbs: The suburbs saw an increase in circumference in 2021 with over 60 per cent launches.
Rise in realty stocks: The year 2021 saw a boom not only in real estate stocks but also in the broader market. Adequate liquidity targeted the stock markets on the back of satisfactory ROI expectations. arrival of omicron Tensions have slowed this movement somewhat towards the end of 2021, but the mid- to long-term prospects in India remain largely positive, and most businesses are back on track.
Top listed developers register record sales: Top listed and unlisted developers with good corporate governance practices, financial accountability, trust and brand saw great sales. A clear trend is emerging wherein home buyers are willing to pay a reasonable premium for the products being offered by reputed players.
‘Realty’ check of big developers
Sales booking of Brigade Enterprise up 59 per cent to Rs 1,310 crore in April-September period
Godrej Properties sales booking up 18 per cent to Rs 3,072 crore in April-September 2021
Prestige Group’s Q2 FY22 sales booking up 88 per cent YoY at Rs 2,112 crore
Macrotech Developers sold assets worth Rs 3,000 crore in April-September; On track to reach the target of Rs 9,000 crore for FY22.
Shobha got the best selling price of Rs 1,700 crore during the April-September period.
(source: anarock)
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