Homebuyers Trend in Covid times across MMR – Dr Niranjan Hiranandani

Dr. Niranjan Hiranandani, MD, Hiranandani Group

The new normal lifestyle as an outcome of Covid times has resulted in change in home buyers buying preferences.  The demand for housing has remained inherent in pandemic crisis on back of security and stability it offered during testing times. Importance of owning an own home has gained traction which has led to fence sitters turning into the actual home buyers. Renters have underpinned the significance of own shelter and hence it has become imperative to buy an affordable property. Property market across cities also witnessed trend of home upgradation by the existing homebuyers who wish to now accommodate the work, study, and wellness from home routine. Thus, demand for large luxury home prevailed across residential markets especially in peripheral locations like MMR.

The recent media reports reveal the total housing sales in the MMR (approx. 47,140 units) in past nine months between July 2020 and March 2021, where-in massive 65 per cent of buyers upgraded to bigger properties ranging from 1BHK to 2/3 BHKs. This fits in with the trend of upgradation, a segment that has been among the leading numbers of home buyers in MMR.

Justifying the demand for larger properties is in wake of work from home sentiment that prevails across industry. The market dynamics stood conducive for home buyers in form of attractive price-points, reduced stamp duty rates, historically low home loan interest rates and the growing preference to move to open, green spaces in peripheral areas that also offer well planned residences with better infrastructure. This augured well for homeowners to take the plunge and move into bigger apartments meeting the rising family needs.

While the post-COVID-19 period (July 2020 – March 2021) saw a whopping 90 per cent sales to end-users, investors accounted for the remaining 10 per cent. The interesting aspect of the trend is that numbers of women home buyers have increased in the MMR over the last year.

Home buying seems to work for women buyers at two levels – first, safety in one’s own home. Second, as an ideal investment from a long-term perspective, given that residential real estate provides steady rental income as also capital appreciation in the long run. As compared to other volatile assets, real estate has grown in terms of being a preferred asset class for investors.

Home buyers’ preferences towards buying ready to move in and under-construction properties has changed. Homebuyers are more inclined to buy under- construction properties with the branded developers who proven track record in terms of delivery timelines and quality.

While ready to move in was the largest chunk at 38 per cent, while those due for completion in a shorter time frame – up to 2 years – comprised 35 per cent. Homes with longer completion timelines (more than two years) saw 27 per cent of home buyer’s preference in lieu of staggered payment facility.

Industry has witnessed the positive impact of RERA in enhancing the trust and transparency among the customers and developer’s fraternity.  This positive confidence index has played a major role in the last category getting 27 per cent of sales during the post-Covid-19 period. Most of these projects are from leading developers with good completion records, this has also been a key reason why home buyers are willing to wait for under construction homes. That these two aspects worked positively for home buyers even during the pandemic is a heartening sign, and one looks forward to similar positive trends in the coming days.