The year 2020 ended on a positive note for the real estate sector with average prices increasing by ~1% in Q4 2020.
Notwithstanding the uncertainties caused by the pandemic, 2020 ended on a positive note for the real estate sector with average prices increasing by ~1% in Q4 2020, reveals Magicbricks’ latest PropIndex for the quarter of October-December (Q4) 2020. Surprisingly, during the festive season, the prices for the much-in-demand ready-to-move segment remained stable during Q4 of 2020, but the underconstruction segment rose by 2%, amidst the recovery phase. The increase in under construction prices was primarily led by western and southern regions.
At the city level, the western region witnessed the most price increments, and prices in MMR (Mumbai Metropolitan Region) and Ahmedabad rose by ~1% and 1.4%, respectively, while remaining stable in Pune. In the South, while Bengaluru remained almost stable, Hyderabad and Chennai witnessed quarterly price increments even though YoY price change was still negative by 1-3%.
Prices in the Delhi NCR remained flat in Q42020, with a slight decline in the core markets of Noida and Gurugram. However, it has shown an improvement in affordable locations such as Noida Extension, New Gurugram, and Sohna.
The property search volumes remained at elevated levels in Q4 2020 at about 30% higher than pre-COVID levels, after touching more than the 50% hike in Q3 2020, as buyers continued to make a beeline because of COVID-led availability of distress deals and festive season discounts. On the supply front, Magicbricks witnessed more than a 25% increase in property listings in Q4, post falling by ~10% in Q3 due to improvement in new launches and secondary market listings.
Commenting on the PropIndex report, Sudhir Pai, CEO, Magicbricks, said, “With uncertainties around the economy and jobs now stabilising, we are witnessing signs of growth in the real estate sector as well. The economy has also stopped shrinking since October 2020 and now we are seeing a V-shaped recovery in the real estate sector. There are predictions of net positive GDP growth for the ‘Oct-Dec 2020’ quarter at 0.1% and rebound growth at 10% for FY 2021-22, making it surpass pre-COVID levels. With impetus from the government in the form of stamp duty cuts in some states and first-home buyer incentives, buyer demand is expected to stay at elevated levels in 2021.”
The PropIndex report suggests that many businesses will reassess their workspace requirements and the work- from-home strategy in 2021 and that would result in heightened volumes of search in 2021 in commercial as well as residential segments to accommodate the changing requirements.