Top 4 Emerging Realty Trends After 2nd Wave In Housing Segment
--By Nripendra Malik, MD, Suparna Buildtech.
Corona pandemic has altered many of the things and practices. It has impacted real estate as much as it has changed other businesses and industries. The second wave, in particular, has changed the things in real estate industry far more dramatically than the first one. The second wave has given rise to some trends while deepening some that emerged in the first wave. The following are some of the trends that will define the way in which the real estate industry will function in the next few quarters or even longer:
1 Demand for bigger and safer homes: The second wave has caused people to choose bigger houses that have extra rooms for work and play. The demand of luxury housing has seen an uptick in the country. Even in metros like Mumbai, there is demand for larger homes. The demand is likely to stay for a while as people don’t foresee things returning to how they were before Covid in terms of kids’ schoolings and work from office setup. There is already some traction for luxury houses in recent times which will get accentuated further in the next few months or even year.
2 Correction in prices of properties in the secondary market: The second wave has impacted the prospects of the economic growth negatively which has made citizens wary of their financial condition. The fear of job losses is real and many individuals are either postponing their decision to buy a property or are buying only if there is a significant discount available on the sale of property in the secondary market. This has led to property owners cut their quoted prices for sale of properties. This is especially true who want to sell off their properties on an urgent basis. The secondary market prices will also start to impact the price levels in the primary market at some point of time if the trend continues beyond 2021 or 2022.
3 Co-living industry will be hard hit: The coliving, which was expecting to see light at the end of the tunnel after ebbing of the first wave, will again be impacted quite majorly. Not only the work from home will prevent the young professionals to leave their original cities and towns to come and work in metros, the few who will come will not lime to share rooms or apartments in the new normal due to corona. They will opt to take an entire apartment, albeit small, on their own.
4 Pressure on rents: There is additional pressure on rents that property owners can demand. The rentals were already down owing to corona's first wave. Now the second wave has made it worse. The property owners in metros and other larger cities will be the worst hit as millennials and others who have been coming to these cities from their native towns to work in companies will be coming in much smaller numbers due to work-from-home and hence the property owners will find it difficult to find tenants. The tenants’ bargaining power will increase many-fold in the coming few months as there is far more properties than their takers.