Beyond the pessimism & optimism and, to some extent, more than expected recovery post the Covid-19 lockdown, the fact remains that 2020 has been by and large the most unforgettable year for the economy in general and the real estate market in particular. The old timers in the business even maintain that this has been even worse year than the global economic collapse after the Lehman crisis in 2008.
In the financial sector, housing finance is relatively a new concept as the government took interest in the last two decades to diminish the housing problem in India. However, the participation of banks and financial institutions in the housing credit sector has swelled and the sector itself has evolved over the years, fuelled also by the concurrent evolution in government regulations in the sector and real estate industry as a whole.
Ever since the lockdown was imposed in March 2020 with Coronavirus scare at its peak, it seems the built environment of the Indian real estate is experiencing the Placebo Effect. The Placebo Effect is when an improvement is observed, despite an individual receiving a placebo as opposed to active medical treatment. In medical fraternity, it is estimated that 1 in 3 people experience the placebo effect. It seems every stakeholder, barring the home buyers, is experiencing the Placebo Effect in the property market.
While the COVID-19 has by and large dented the confidence level of the real estate developers, Aditya Kushwaha, CEO & Director of Axis Ecorp believes there are silver lining for the players who are forward looking in their approach. In an exclusive interview with Track2Realty, Kushwaha asserts that the Work From Home trend would shift the focus from top metro cities to open spaces in and around the tourist destinations. He therefore urges the government to look at the Holiday Home segment as a priority sector.
If the Indian real estate was gasping for breath since long, Cronavirus has further pushed it to the ventilator. Track2Realty in an online poll finds that the challenge is no more limited to the unsold inventory, liquidity crisis & buyers’ reluctance, but to keep the existing buyers stay afloat. Job losses and salary cut threatens to make foreclosure a reality now.
The good news is that the Indian home buyers do understand that the lockdown post the Coronavirus was neither in the hands of the builders nor could have been anticipated. They hence don’t object to the period of six months being declared to be Force Majeure. The bad news is that the home buyers across the country feel the government’s declaration of Force Majeure is not in accordance with the law of natural justice. Track2Realty Online Poll finds that the home buyers are demanding equal leeway in the housing market.
For generations, real estate leaders were cautious in changing their business models. But in recent years there has been a significant change. So far the numbers have been on the lower side, but Covid 19, has initiated companies to adopt digital solutions at an unprecedented pace. According to a survey, digitisation is taking precedence across the sector and more than 90 percent of the occupiers and developers are aiming to bring a technological shift in their business operations within the next five years.
It is not just the fiscal performance or the stock market resilience that have elevated Godrej Properties to the coveted brand leadership across India. The performance has been remarkable and ever improving on various scale leading to better consumer experience and consumer connect. In a gloomy market of uncertainty, Godrej Properties looks most promising to meet the delivery commitments as well. Last, but not the least, while most of the corporate entities found it altogether challenging turf in the business of real estate, Godrej appears to be a natural real estate brand beyond its market presence in other businesses.
The real estate developers had a sigh of relief when the Government of India heeded to their demands for declaring Coronavirus hit construction under Force Majeure. The Union Finance Minister Nirmala Sitharaman assured the sector to issue an advisory to States and Union Territories and their regulatory authorities to extend the registration and completion date Suo-Moto by six months for all registered projects expiring on or after March 25, 2020 without individual applications.
The buyers of Valenova Park have questioned that at a time when the District Administration of Gautam Buddh Nagar has warned the maintenance of Eros Sampoornam to stop hiking maintenance charges during the lockdown or else face arrest, how come Hawelia is hell-bent to charge maintenance without giving them any facilities, other than water and limited electricity with diktat to use it economically.