The current lock-down triggered by the crisis due to coronaviruses has greatly affected the global economy and much of the sector worldwide, including real estate. It is difficult for the residential market, which already had low demand issues, to commence new projects and finish the projects due to building delays and job shortages.
We talked to celebrated Astro Strategist™ and Business astrologer Hirav Shah about what the future holds for the real estate industry to which he said that at this juncture, the economic reforms and stimulus package should be of great help. In the next few months, low stamp duty and home loan interest rates will help convert potential customers into actual home buyers, while enhanced tax benefits on home loan EMIs would also be of great help. The industry awaits positive developments in these aspects, which will make it easier for a consumer to think about purchasing the property.
New patterns were noticed in the real estate industry due to a COVID-19, the survey has proved that is such a big move towards the acceptance of online Real estate platforms has been increased to update 75%. Many of the People are showing interest in inspecting properties online as well as negotiate and finalise deals. In addition, virtual visits to the site become reality and a large selection and buying process of a property can be carried out digitally.
Though the real estate market can receive a jolt as many people may postpone their purchases due to salary cuts and job cuts but those who can afford and are looking out for a property will be at an advantage. The investors are looking for new opportunities in the affordable or budget and mid-segment at discounted rates and possible bulk sales at attractive prices.
To Developers, NRI investment has always had a special status. Several ventures are clearly planned to attract investment. In the resumption of the property market, NRIs will play a major role. After the drop in the rupee value, NRI interest may adjust, and they may want to buy residential property due to the emotional relation it offers.
Hirav Shah, who is an expert in Astrology for Business success, says that this looks like a decent time to make an investment from the buyers’ point of view, looking at the positives which buying one’s own home translates into. However, the developers will have to consider aspects like job security and salary cuts to make things happen. The new paradigm will be a lot different than what the industry has witnessed over the last decade.
Although demand for affordable housing has recently risen, the lock-down is a significant setback for the still crisis-ridden market. That will deter developers from joining the cost-effective market because they had already dealt with cost management in these projects to boost the end product.
Hirav Shah also warns about the high impact on the under-construction projects such as construction cost may increase due to below reasons
- Labor costs increase
- Disruption of the supply chain and increased lock-down logistic costs
- Variations in currencies
- Stock demand spikes include steel and cement
- Delay of construction and schedule
- There may be Delay of construction and schedule due to below reasons
- Delay of migrant laborers returning to sites may delay in delivery of equipment and long lead items.
- Quality and safety
- Health screening at the site
- General improvements in housekeeping at the site and labour hutments.
- Appropriate budget allocation for social distancing at site
- Quality impact due to non-availability of skilled workers and quality materials on time.
In India there are around 20 thousand ongoing projects which require 9 million workforce and that leads to an increase in labor cost. Govt’s restrictions on working timing, safety precautions and measures in implementing social distancing leading to productivity fall hence more manpower costs.
The long term market is expected to rebound with price corrections maybe by 4th quarter when prices stabilize, industrial production is revamped to pre-Covid-19 Capacities and laborers return to sites.
Finally, Hirav Shah who is proficient in Astrology for Business success says though the things do look grim and dark for the real estate industry right now, the footprints are surely leading us towards a new landscape in the real estate sector.