Owing to the business disruptions triggered by demonetization, GST, and the roll-out of RERA in the past few years – the year 2020 was poised to bring a recovery in the Indian real estate sector. However, all hopes were thrashed as the global COVID-19 pandemic hit India creating a huge dent in the sales of residential and other commercial properties. The year 2020 brought more despair and it was the developers that took the heat with sales coming to a standstill in the first half of 2020. However, post opening up of the economy in the staggered manner in the second half of 2020, the developers witnessed an increase in demand in ready-to-move residential properties resulting in a positive sentiment in sales. So now moving into 2021, change in buyers’ preference including the need for additional space, demand for amenities, and the realization of owning a house in troubled times would further cement the growth in sales. And with the government announcing a slew of measures, and along with the RBI’s support, the industry is now bullish for growth by the end of 2021.
While 2020 defined the ‘new normal’, the year 2021 would be the year where this ‘new normal’ becomes reality, and adapting to it would require imagination and digital transformation. 2021 would be the year where the Indian real estate sector is set to chart new growth trajectories. Let us have a look at some of the key trends that are going to bring a major shift in the real estate industry.
Boost in bigger spaces to incorporate work from home culture
The lockdown forced businesses to move to a virtual workspace, resulting in employees working from home. This resulted in people staying at homes for longer hours than before and a compact corner of the house became a virtual meeting hotspot. In the second half of 2020, developers noticed an increasing need for the provision of a quiet and ergonomic working environment at home. The same preference would continue to take high priority as people are looking for larger layouts with higher safety, hygiene, and other necessary amenities that are close to the community. Additionally, the current homeowners have also become more inclined to look for bigger spaces in apartments while upgrading from their current accommodations.
Digital Transformation
A home is something very personal for everyone. And it’s one such physical asset that people relentlessly go out to see their space as for them it’s just more than bricks and walls. The lockdown forced people to stay at home resulting in a void for site visits. However, real estate developers swiftly adopted digital transformation and instead of letting people going out to see their dream homes, they brought projects into the customers’ homes thanks to virtual presentations, virtual site visits, etc. As a result, there has been an increase in digital adoption in real estate, which will go a long way in transforming how properties are sold in the country going forward. Real Estate developers are now utilizing a mix of VR/AR and AI to finalize deals digitally. Virtual tools, chatbots, and drone shoots have gained more prominence as buyers are adopting digital means at a fast pace.
Healthier lifestyle – The Bigger Picture
There is a never seen before emphasis on safety and hygiene. The need for social distancing that came through last year’s pandemic is still there. As stated before, people are opting for bigger living spaces, be it apartments or houses, they are also opting for housing projects that have larger open spaces, to have an active lifestyle while maintaining social distance. Intending to make the transition to a healthier lifestyle, people are looking at housing spaces that can provide the same. This includes walking and jogging tracks, gyms, availability of sports infrastructure among others. Developers should take note of this and provide basic amenities focusing on health and lifestyle. This would not only ensure the safety of the consumers but would also allow them to make an informed decision while selecting and purchasing a property.
Schemes and policies
And while all the points stated above represents a dynamic shift in the growth of real estate, developers looking to get a larger pie of the market should support buyers with a slew of offers such as EMI holiday scheme (ensuring no payment or EMIs until the possession of property), home loan schemes, subvention schemes, etc. Additionally, developers can woo customers by offering modular kitchens, consumer durables, interiors, and gold coins on purchase. The government on the other hand should continue to support the home buyers and real estate developers through policy, taxation, and stamp duty cuts. The fall in home loan rates will continue to push in the government’s aim of ‘Housing For All’ in the year ahead, which would further lead a rise in demand and ultimately result in more sales.
Thus, with an improved buyer sentiment and the rollout of the vaccine to a wider age group, a higher positive impact is likely to be seen on the people who will invest in both residential and commercial projects. This is bound to make the real estate market bounce back with renewed energy.
