Best time for homebuyers for upgrading to Larger homes post pandemic life

Niranjan Hiranandani National President – NAREDCO and MD Hiranandani Communities

The non-extension of the stamp duty waiver has certainly upset the real estate dynamics in Mumbai. However, realtors hope that other benefits such as low home loan interest rates and various lucrative schemes from developers, being the same, would drive the housing sales to satisfactory levels in the upcoming quarters.

The real estate in Mumbai extends far beyond the geographical limits of the Brihanmumbai Municipal Corporation (BMC); the Mumbai Metropolitan Region (MMR) is how we see the ‘new age’ Mumbai. The ‘difference’ between the urban conglomerations that make up the MMR lies only in maps, and Mumbai’s real estate is a term that we automatically take to mean ‘MMR real estate’.

In MMR or Mumbai, the real estate scenario is unique, resilient and has always been an integral part of its DNA. When the Tsunamis of reforms impacted the economy, Mumbai’s real estate was hit hard, but it survived. The beginning of 2020 saw a resurgence, but then, the COVID-19 pandemic happened. While it impaired the market for a fleeting phase, the potential home buyers returned in large numbers from September onwards. It was a combination of various factors, including home loans at historic lows and real estate developers offering various deal sweeteners. However, what helped move this ‘positive sentiment’ into ‘high gear’ was the state government announcing a reduction in stamp duty rates by up to three percent.

The festive season in the last four months of 2020 also played an essential role in enhancing the sentiment, and residential sales moved up. The set of positives worked their magic, but the question on everyone’s mind was- what will happen when the stamp duty waiver scheme comes to an end. Well, that has happened, the State government has not granted a further extension, and March 31, 2021, was the last day to take advantage of the scheme.

I would not get into the advantages the scheme resulted in; definitely, it spurred the housing sales immensely, and the increased registration numbers are testimony to it. But what more did the week gone by showed is that the home seekers who lost out on the reduced stamp duty scheme are not postponing their buying decision. They are not turning into a fence sitter, rather waiting for a possible return of the scheme. It was a combination of different factors that fueled the positive sentiment, and the rest of the elements are just as attractive as they were till March 31. The home seekers, who were unable to finalise their new homes, are continuing with the process. And, this ongoing process will not fructify immediately. The home seeker will factor in a couple of other options before finalising the decision, but the conversion will surely happen.

Currently, many homebuyers are traditional renters who realised the importance of self-acquired home during the lockdowns. The next large segment is families looking to ‘upgrade’ to a larger-sized home, where ‘work-from-home does not create problems as regards available space within the home.

The new normal where we are coexisting with COVID-19, notwithstanding the vaccination drive, has changed the paradigm of a safe and secure home. The requirement now is for a home away from the crowded city centres with open, green spaces within the project’s boundaries. Besides, flexible interiors that can adjust to the changing needs across the day, be it study, work, dining space, family spending time together, entertainment, and wellness, are the cynosure. It is this realisation that is driving the demand for homes across all projects in MMR and Mumbai.

Yes, there will be a blip, as the numbers translated into sales until March 2021 were more than normal. But, with other factors remaining constant, there is no reason for sales to be affected by the scheme not being extended. Many positives drive sentiment even now, and we are bullish on Mumbai’s real estate as we move further into 2021.