“The government needs to take quick and bold corrective measures for the housing sector to revive the consumer demand. Reduction in statutory payments and GST rates can go a long way,” says Surendra Hiranandani, Chairman and Managing Director, House of Hiranandani.
In an exclusive interview with RoofandFloor, he spoke about how real estate companies are realigning their business strategies to sustain in the current times, future trends, and much more.
Here are the excerpts.
How has the pandemic changed the way real estate operates in India?
The impact of the novel Coronavirus on Indian real estate has been unprecedented and has exposed the entire fraternity to some unique challenges.
The crisis has made brands understand the importance of adopting newer technologies for better and faster functioning.
Product planning and designing now take place after considering health, hygiene, and wellness concerns of the buyers.
Home automation is no longer a luxury. Every new home has some presence of automation for the convenience and safety of the buyer.
Unlike the past, when sales was a personalised experience, today due to tech-enabled marketing platforms such as virtual visits, 360-degree images, video-conferencing etc. buyers can experience the project without visiting the site.
Have you started receiving enquiries? Are there any major changes in homebuyers’ preferences in Bengaluru?
During the lockdown, despite the slow pace of the market, we successfully achieved our recalibrated targets due to concentrated promotion and sales efforts through a digital medium.
However, there is a held up demand for homes due to the pandemic and the long lockdown. Now, as the economy is gradually returning to normalcy and lockdown is relaxed, we are experiencing a rise in the enquiries.
The preferences are totally aligned with the new requirements. With work-from-home becoming the new normal, there has been a demand for spacious homes with high standards of hygiene and safety.
There is an increase in demand for premium projects that provide comfort, space, convenience, and security and are ready-to-move-in or nearing possession stage. Further, growing locations with strong physical and social infrastructure are witnessing greater demand than earlier.
What should the government do to revive consumer demand?
In addition to the already announced initiatives, there is a need for more support to provide a thrust to the sector that has been capital intensive. These include:
The government needs to take quick and bold corrective measures for the housing sector so that the demand can be boosted. Any positive impact on the sector can have a cascading influence on over 200 allied industries and the overall economy.
How is the festive season faring this year in the city?
Festive sentiments have always been significant for the real estate sector, as big-ticket purchases are generally planned around auspicious times. Sales performance during the festive quarter from October to December has always been 30% high in comparison to sales during non-festive quarters.
We are expecting the same this year as conversions are likely to take place from the pent-up demand. Festive offers will also play a critical role in maintaining the sales momentum and providing a boost to the sector.
This will be a time when the demand that has been held since lockdown will witness conversion, as homebuyers will prefer going ahead with their planned purchases.
What are some key trends that we can expect in the times to come in the residential market?
Increased homeownership: The current focus on ‘stay home, stay safe’ has reinforced the importance of homeownership; as living in an owned home is much safer and secure than the uncertainty faced in a rented home.
Townships, independent homes will be largely preferred: Homebuyers will value residences that are holistic in nature with all necessities, conveniences, and leisure in proximity to the residence. There will be a rising preference to live, work, and play in controlled environments. As a result, we will witness a growing interest in townships and independent homes in the near future.
Demand will rise in the peripheral areas: People will migrate from congested city centres to peripheral areas with good infrastructure and connectivity. Properties available in these locations come at a relatively better price than properties placed in premium locations.
Ready-to-move-in properties to be in demand: To cut uncertainty and to benefit by personally seeing the property, homebuyers will prefer ready- to- move-in properties over under-construction ones.
Branded developers to play a critical role: Industry players who function in an organised manner and in a professional way will play a larger role in the functioning of the sector. Players who do not change as per newer requirements and continue functioning with conventional mode will gradually disappear or consolidate with strong players.
Should home seekers wait for property prices to correct or take the plunge?
The current scenario provides excellent investment opportunities in real estate.
The record-low interest rates, rationalising the risk weights on home loans and linking them to LTV ratios, and other relaxations offered by the government makes it an appropriate time for serious home buyers to make their purchase. Besides, festive offers and benefits by developers create additional advantages for buyers to buy during this season. This also makes it the best time for NRI’s to invest in a safe and secured investment in the home country.
Your take on the future of residential real estate post Covid.
The pandemic has made us realise the importance of staying in an owned home that provides safety and security. People living in rented apartments will prefer buying a home instead of facing uncertainties during trying times.
Holistic homes or homes in sustainable developments with large spaces, greenery, and the secured environment will be the future. Functional homes or flexi rooms will be a common feature as work-from-home, and online schools are expected to continue for some more time.
Further, residences that are tech-enabled will be the future. By adopting technologies featuring Internet of Things and Artificial intelligence, homebuyers through smart devices can manage several tasks with a single command involving touch or verbal instructions. With improved technology, homebuyers will look for enhanced security within and outside homes.
Technology will also prevail in the construction of homes since it is less labour intensive, cost-effective, and quick in comparison to conventional methods of construction.