Despite the second wave of the pandemic leading to economic repercussions in April and May 2021, residential real estate witnessed recovery in June with price growth across India of 1.7% during the quarter, as per Magicbricks PropIndex Q2 2021 report.
The demand for housing in June 2021 reached March 2021 levels. The lockdown due to the second wave and extension of Work from Home (WFH) culture led to rising demand for 3BHK and above, with homebuyers looking to upgrade their houses due to the requirement for extra space for home offices.
The shift led to a rise in demand for 3BHK and above in top cities like Delhi-NCR, Kolkata, and Hyderabad, reaching an all-time high of over 65% of the overall demand share in these markets.
Sudhir Pai, CEO, Magicbricks, said, “The recovery in demand for residential realty has been much faster in the second wave than the first wave last year. Markets of Chennai, Bengaluru, Delhi-NCR, Thane, Kolkata, Noida, witnessed price corrections in the range of 1% to 2.3% during the quarter, along with increasing debt and medical expenses. This quarter also witnessed a rise in supply pan-India by almost 8%, due to new launches, with Hyderabad witnessing the maximum jump of 20%.”
“Factors such as consistent demand in large-scale properties and a higher flow of global PE fund, ensured by the sector's good risk-adjusted returns, have contributed to this recovery. This quick recovery heralds a return to industry stability,” he said.
The greatest impact of the crisis was felt by middle- and low-income buyers, who prefer smaller homes with simpler layouts. In terms of money flow, however, most premium and high-income buyers were relatively unaffected by the crisis. As a result of this trend, demand for smaller houses has decreased, while demand for larger houses has increased in Q2 2021.
Source: Financial Express