COVID 19 & Real Estate
COVID -19 (Coronavirus) has not only changed the way we are living, but also affected other fronts of our lives, like, the way we work, socialize with others around us, as well as the way we think. Almost every industry around us has been impacted, including the one in which I am working with, i.e the real estate sector. Although there has been a major negative impact, COVID-19 has also opened an all together new era of real-estate sales which was not yet explored so much. I strongly believe there is a segment of the society which has realized the importance of owning a home in the lockdown, and hence the demand for real-estate will soar post COVID-19 due to this segment.
During the lockdown scenario, almost all real estate developers have focused on digital strategies and have reached out to the millennial audience that constitute or influence a large part of the buyers. Priorities of people have also changed and they now have realized the importance of owning a home, especially the ones that can guarantee safe & secured environments. This is one of the major indicators that point out that the demand for real estate will go up considerably.
Here is my message to all those prospective buyers – the present crisis is different from 2008, the market was booming at that time and every quarter the property values were appreciating. Coronavirus pandemic has hit us at a time when the market has been in a slow mode for the last five years. The spread of this virus will delay the recovery of the market, but with the help of various government initiatives it looks like the demand will revive soon, which will also be a contributing factor for withholding the prices at the juncture they are currently, if not rising. If you are waiting for the prices to fall further, then trust me it is not going to happen for sure.
At the same time, our prices are constituted by many factors and some of the key factors are availability of raw materials, skilled & unskilled labor, pressure of delivering on time, even after 2 ½ months’ lockdown. These factors will certainly affect the profitability. In my view, this is the right time to buy property, however, one should do consider these points before buying a property:
- Evaluate your own financial position, both current and in the next five years. You should also gauge if you are able to take any more loan liability, especially if you are solely dependent on your monthly income from your job.
- It is important for you to stick with a prominent developer with a good track record with both customers and financial institutions. It will ensure safety of your capital invested with them.
- Go through the selected projects’s RERA details, all the relevant approved details are always available on RERA website to evaluate your buying decision from a legal point of view.
- It’s a common practice to monetise long-term savings like PPF to finance buying of the property, but in current times, it would be sensible to leave at least 9-12 months equivalent of monthly income in savings before buying a new property.
- Fiscal prudence should be paramount and it will help in making the right decisions for buying any property.
If not much, this pandemic has certainly made us realize the importance of having a roof over our heads. Keeping this in mind, the demand for real estate is going to surge in the near future.
The best way to secure your future is by buying a home right now!