A Holistic Look at Real Estate Buying
Haresh Motirale Founder, Director – Brandniti
From reduced home loan rates to Govt’s initiative to reduce stamp duty and more, here’s why home-buying is flourishing more than ever before.
What were the paradigm shifts seen in the year 2020
The year 2020 can be truly termed as a historic year, thanks to the COVID pandemic. Amid all the uncertainties and challenges we faced since last year and continue to do even now, it’s imperative to have a holistic look at what the future holds. Needless to say, the pandemic has seen a paradigm shift in the way businesses operate across industries. Little wonder then that most of them are realizing the potential of moving from offline to online presence. The ‘New Normal’— work from home and social distancing among others— is likely to continue till the end of this year too.
While many industries continue to struggle to make ends meet, some have weathered the storm and even flourished. The Real Estate Industry, for instance, has witnessed an upswing as buyers are now thinking more clearly than ever. Rather than speculating about interest rates, they are pondering over questions like what if the ‘new normal’ continued for the next five years and beyond? What if companies decided to shut offices and let workers work remotely forever? What if malls, gyms, parks never opened up and everything centred on one’s home itself? This, in turn, has seen a significant increase in the home-buying decisions, even for those who were indecisive until now.
How has the real estate industry changed?
This scenario has also rearranged the priorities of the real estate sector. Multiple projects that were once considered to be lack-lustre or too far away from the city, are now gaining precedence as more and more buyers are opting for more open spaces as well as less dense and affordable properties. Nuclear families and millennial buyers have slowly but surely begun to realize the benefit of buying a house over renting. As work from home has become a viable option for many, buyers are now willing to shift to bigger houses amid large open spaces that promise a better lifestyle and are affordable.
What are the reasons for the upswing in home sales?
Multiple factors favouring the home buyer have catapulted sales figures. Though the beginning of the lockdown brought the real estate sector to a grinding halt, developers swiftly changed gears to adapt to the crisis. They came up with lucrative offers and substantial discounts. Furthermore, the housing loan saw a drastic dip from 11% to 6.75%. Add to it, the initiative by the Maharashtra State Government to reduce the stamp duty for buyers, in two slabs—by 3% from 1st September 2020 to 31st December 2020 and then by 2% from 1st January 2021 to 31st March 2021. There was also a concession offered of 1% over the prevailing stamp duty rate on property transactions if the transfer or registration of sale deed was done in the name of women.
To help the homebuyer, the industry as well as the exchequer, the State Govt also reduced the premium charges levied on new projects by the civic authorities by a whopping 50% till the end of this year.
The pandemic has also driven home the point that if working from home were to become a norm for a long time to come, it would be wise to invest in a larger apartment. This would mean that an additional room can be converted into an office space without disturbing the rest of the house. Keeping this in mind, developers are offering smartly designed homes with added spaces in project launches. Furniture companies and interior solution providers are also taking advantage of the opportunity and offering flexible designs of furnishings.
One cannot ignore the importance of getting the house possession on time and the risk of failing to do so. Hence, buyers are opting for reputed developers instead of lesser known names and ready to move in homes. Understandably, prospective buyers are preferring developers with least execution risk, even if the property is relatively more expensive.
So, even as the vaccination rolls out, the fear of an uncertain future holds. Whether you stay at your present location or shift base e far away, as long as you find your own comfort zone, you will have won half the battle.