Interview: Buyers want homes with more liveable space for WFH regime: Manju Yagnik-Nahar Grp
Buyers want homes that offer more liveable space for the WFH regime. In these pandemic times, purchase of a house is being viewed more as utility space doubling up as an office corner, virtual workouts, online schooling, and enough open space. In an exclusive interview with RealtynInfra.com, Manju Yagnik, Vice Chairperson, Nahar Group & Sr. Vice President, NAREDCO, talks about the various aspects f the real estate industry. Here are the excerpts:
Q1 The real estate sector faced one of the worst crises in form of a pandemic. How do you see its effect on the sector?
It's been like rough weather for real estate for almost half of the year in 2020 however, all storms come with a silver lining. The already slowed Indian real estate market had to press the pause button during the pandemic lockdown. However, the lockdown of a health emergency forced-launched the biggest ever work-from-home (WFH) experiment globally. We saw the emergence of the fact of owning one's own home, an overnight necessity, and proved to be a blessing in disguise. With companies, considering the safety of their employees moved to WFH culture, homeownership had suddenly become the focus which rekindled the hopes in the sector. Pandemic cemented the very need to own a home in the minds of the buyers who considering safety, security, and WFH decided to purchase a home. The sector with the meagre sale during complete lockdown started registering good sales numbers post phase-wise unlocking pushing the sector back on a growth trajectory.
Q2 Is the sector back on the recovery path to withstand 2021?
The need to own a home considering safety, security, stability, and WFH was a strong indicator that the sector will enter the recovery path. This became evident with home sales crossed the Rs 9,000 crore mark for the September quarter for the first time after lockdown, a remarkable recovery when compared to the April-June quarter. The buying in the real estate market, majorly from the end-users has been an outcome of the steep reduction in stamp duty, low home loan interest rates, and lucrative offers being provided by developers making it a `buyer’s market’. These measures pushed home sales up by 51 percent for the quarter ending December against that of September 2020. Mumbai, itself accounted for 23 percent of the overall sales reflecting a quick recovery in the sector. The sentiment index also touched 40 percent in Q3 from a low of 23 percent in Q2. The market is healing and is in a stable recovery phase, and with visible timelines of rollback is further attracting the buyers to take a plunge in this market. This encouraging customer response post opening of lockdown, ongoing government support, and developer offers will surely propel the industry in 2021.
Q3 What property type, BHK configurations, and budgets were popular among buyers in 2020?
In the current pandemic times, the purchase of a home is being largely viewed more as utility space doubling up as an office corner, virtual workouts, online schooling, and enough open space. Larger 2 BHKs measuring approx. 650 plus square feet of actual liveable space for WFH (Work from Home) regime available in between Rs 1crore to Rs 2 crore has seen a good demand. The demand came largely from end-users, first-time homebuyers, fence-sitters, and even those wanting to upgrade to a larger 2BHK considering the entire family at home due to pandemic. Also with those switching from rental accommodation to owned addresses choose for 2BHKs considering more liveable space. Mumbai and the MMR region offered spacious 1 & 2 BHK ranging from approx. 400 to 650 plus square feet respectively, for the WFH scenario.
Q4 What are some of the trends which were prevalent during 2020 and will they continue in 2021?
Indian Real Estate Market’s demand dynamics have evolved and changed post unfolding of pandemic scenarios and the sector witnessed a wave of newer trends. With social distancing becoming part of our everyday life the need for a home only for living purposes has rather ceased. Buyers are demanding developments that offer more liveable space for the WFH regime, health and wellness quotient, townships, outdoor amenities, educational institutions, medical and healthcare facilities, location advantage, and good connectivity among others. The increased demand for 2BHK was in trend since the opening of lockdown which will continue understanding the need for larger homes from buyers wanting spacious homes. For the very first time, we saw end-users and millennials entering the market who wanted to own a home of their own taking advantage of market conditions. Pandemic has accelerated the trend of digitization in real estate to boost efficiency and enhance the customer experience. We expect the government to further continue the digitization platform in 2021. The year 2021 will see all these reforms are set in motion, for a faster recovery of the economy amid the Covid-19 scenario.
Q5 What else the governments need to do for the complete recovery of the sector in 2021?
The vaccination program will result in a turnaround in the realty market due to increased buyer’s confidence. As a leading township developer, we would want to see continued support from the government in 2021on various fronts, be it on policy, taxation, stamp duty cuts, and circle rates. We expect the extension of the lowest interest rate and easy liquidity regime to continue to lead a positive push to the vision of 'Housing-For-All' in the year ahead. The industry’s long-pressing demand to bring down construction premiums in Mumbai city by 50 percent till December 2021 needs to be passed which will bring down the cost of housing in the city. The further need for rationalization of GST for under-construction projects and relaxations in income tax rules allowing differential from 10 % to 20% for the sale of residential units costing up to Rs. 2 crores. The government should also make single-window clearance a reality by bringing down the number of permissions and clearances for faster completion of projects building buyer confidence in the sector.