The coronavirus outbreak or the Covid-19 pandemic has had several negative impacts for most businesses, and the real estate sector is no exception. When individual clients, seeking real estate investments, or simply buying property to own their own home, panicked, sales in the real estate industry plummeted. Economic activity in India has stalled since the unity government announced a shutdown on March 25, 2020. The lockdown has been extended until June 20, as the number of infected patients has risen rapidly. As the locks expire, the economy is expected to recover in the long term.
The blockade, which lasted 70 days, had several negative effects on this sector, such as B. a sharp drop in sales and the interruption of the start of projects. When the Indian economy collapsed, many private companies turned to cost-cutting measures such as mass layoffs, layoffs of employees, and steep pay cuts. With job insecurity looming, people looking to buy or invest in real estate have postponed their plans. Another impact of the coronavirus on the real estate sector was seen during the blockade when construction of housing projects was blocked due to transport blockages and a massive exodus of day laborers. However, experts predict a recovery in the sector, led by a sense of security.
Faced with a looming real estate crisis, the union government announced an alternative investment fund (IDA) worth Rs 25,000 to revitalize. To stimulate demand and allow people to buy and invest in real estate, the government previously announced tax breaks of up to 3.5 billion rupees per year on paying interest on loans. Real estate. At the same time, a 7% decrease in the interest rate on mortgage loans was announced. The RBI’s decision to lower buyback rates was also made to boost consumer confidence about the purchase.
Although the downward trend continued in the second quarter (April to June), in the third quarter (July to September) strong signs of recovery were observed. According to a report titled Real Insight Q3 2020, a quarterly analysis of India’s eight largest residential real estate markets by PropTiger.com, home builders sold more than 35,000 units in the third quarter, an increase of 85% over to the second-quarter report. The net supply chart also increased by 58%.