Though the market sentiments are expected to witness an upswing towards the end of the year, the overall sentiment will remain low and in the sluggish zone, it seems.
The investments in the country’s real estate sector have hit an all-time low during this global pandemic. The investment sentiment has fallen to 22 in April-June, from 31, as per recent reports. Though the market sentiments are expected to witness an upswing towards the end of the year, the overall sentiment will remain low and in the sluggish zone, it seems.
The nation-wide lockdown and the rising spread of the virus are still creating many bottlenecks in the sector across the country. Labourers, who are the backbone of Indian real estate, had to move back to their respective hometowns due to the crisis. This has impacted construction activity and sentiments of developers in a major way. While the country has already witnessed an ease in the lockdown in the last one month, the lockdown is expected to ease further with the onset of the festive season. Industry and the government need to come together to bring the rising sector back to normal.
Below are a few suggested measures which will keep up the momentum and boost market sentiments during the lockdown.
Need for government push: While the Central government has announced welcoming measures which provided the much needed stimulus to the economy, there is a need for more demand boosting measures, especially for the real estate sector. Measures like tax benefits for buying a house, added incentives for affordable housing, easing of credit availability for the sector and easing on loans are needed to improve the market sentiments.
Bringing construction workers back: Construction workers not only help in constructing houses, but they are the most important and silent contributors to the sector. Bringing them back to work after the Covid pandemic will be a task for the entire industry. No matter how many schemes and special offers are introduced to consumers, the sector will come to a standstill without construction activity. There is a need to introduce labor-friendly reforms and policies for the construction workers which will convince them to come back. They should also be provided the travel fare for coming back to work in cities.
Innovative offers: While special offers and festive discounts have always instigated the interest of buyers, more and more offers and discounts should be provided to boost buying sentiments. The discounts will also help in clearing unsold inventory of developers. Developers and real estate consultants can ideate around a lot of innovative schemes like referral schemes; cash back schemes, property swap schemes, gifts on booking, digital friendly schemes etc. The schemes will act like a constant dosage of excitement for consumers as well as developers during the lockdown.
Attractive payment plans: This is another way via which a developer can attract home buyers during the pandemic. Builders can offer various attractive payment plans like 20:80 or assured rental either until possession or after possession. A lucrative payment plan can boost a buyer’s sentiment and help him with quick investment decision during the trying times.
The dream of owning a home always has an emotional side to it, which supersedes any other form of investment. It is a lifelong asset, which gives the happiness of being with a family, enjoys the pleasures and challenges of life and aging with the house. Even a multi diverse portfolio of investments cannot come close to the warmth of owing a house. From the investment perspective, a property always yields more value with years and can be a steady source of rental income.
While the Covid pandemic is temporary and market will see rising sentiment by the beginning of 2021, collaborative measures by the government and private industry players can keep up the momentum even during this crisis scenario.
(By Sakshee Katyal, CEO of Home & Soul)