How is the residential real estate sector being impacted by COVID-19?

How is the residential real estate sector being impacted by COVID19

The residential real estate market will definitely change on account of the COVID-19 pandemic. Consolidation has accelerated visibly in Indian real estate and with work from home becoming the new normal, mid-income demand for residential units may eventually shift towards smaller Indian cities and suburbs/outskirts. Homes are now turning into residences cum offices and many other lifestyle changes will herald rapid evolution for the Indian residential realty ecosystem. 

Buyer focus, according to some experts, will shift towards bigger living formats like 2.5 and 3 BHK apartments. Integrated townships will witness greater traction along with stand-alone civic and social amenities. Buyers will prioritize access to shopping, healthcare and schools while looking for reputed, high-quality developers/brands. Ready to move units will be preferred more along with projects in advanced construction stages. The market will be dominated by branded developers and buyers will prefer those projects with audio-visual and online viewing options. 

Also read: How growing shift towards affordable housing is changing the way people will live post lockdown

Residential real estate may witness more agility in terms of design along with deferred property buying decisions till the pandemic subsides. Office + home concepts may gain more traction as well. The Co-Founder and CEO at Square Yards, Tanuj Shori, stated that consolidation will be a natural byproduct of the COVID-19 pandemic and there will only be a few well-established and reputed realty players who will cater to the biggest chunk of buyers. Those with stronger balance sheets will be able to survive and eventually thrive according to him. He added that demand was always strong in the Indian market although there was a mismatch between supply and demand over the years. Developers with market credibility and decent inventory in the mid-income and affordable housing segments will thrive in the present scenario according to him. 

Shori also opined that home buyers are now seeking larger flats with separate corners/zones/rooms for setting up working desks/offices. This will lead to more buyers exploring locations in the suburbs or peripheral zones of major cities for higher affordability and larger homes. Distance from cities will not be an issue for many home buyers since they will have ample flexibility to work from their homes while being required to visit office for just a few days every month.

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Published Date: 3 August 2020