During the past few years, there has been an uptick in the demand for ready-to-move (RTM) homes, more because buyers have become risk-averse now owing to uncertainties involved in the completion of under-construction property. However, in times of Covid-19, homebuyers are showing an inclination towards the RTM property more than ever.
In the 360 Realtors’ buyer sentiment survey, conducted recently, 40% of the respondents indicated their preference for ready to move (RTM) property, while over 22% preferred resale projects.
“There have been remarkable changes in the industry in the last 6 months, following the lockdown in March end. As per our survey, 70% of the respondents want to buy a home for self use. This is an ongoing trend as the current crisis has reinforced the idea of owning a home. Interestingly, buyers are also looking for long-term investment and parallel rental income. One emergent trend that is going to offset the recent drag in demand is the rise of liquidity especially amongst higher middle-income households in cities such as Bangalore, Pune and NCR. Due to COVID, households are no more spending on international trips, eating out, shopping & festivals, and regular weekend getaways. As a result, on average, households are having Rs 6-8 lakh of buffer liquidity with them, which can be spent on real estate backed by a good payment plan,” says Ankit Kansal, Founder and MD, 360 Realtors.
It was estimated last year that around 3 lakh RTM units will hit the market by the end of 2020, but now, there might be a slight change in the figures. However, the demand for these homes has increased with buyers willing to pay extra just to ensure that they immediately own a piece of property. Realtors say that the demand for RTMs is mostly from the millennials who are most concerned about the health & safety.
Yash Miglani, MD, Migsun Group, says, “The New Age generation is very specific about the needs and this pandemic has made them realize the importance of having a real estate asset. They are looking for ready to move homes where they can have control over their health. Even for investment purposes, they prefer RTM property as it will be an immediate source of extra income for them. The demand has increased as the need is immediate and people want an immediate solution, which is provided by the RTM properties.”
In a post-COVID world, people would like to shift to peripheries wherein they can get larger homes at a lower price. 21.8% of participants in the survey wished to buy homes in peripheries. However, 39% would still prefer to purchase homes in central parts of the city. The survey has revealed that buyers are not just interested in affordable & mid-income housing projects but are also showing ample interest in the luxury segment.
One-fifth of the respondent showed their interest in affordable projects (less than Rs 45 lakh) and 27% showed their willingness to buy mid-income homes (Rs 45-75 lakh). More than 13% demonstrated to buy premium properties (Over Rs 1.5 crore). The RBI has also rationalized the home loan risk weightage and linked them to Loan to Value (LTV), which will further help in the disbursal of high-value loans. The demand has grown owing to the situation thrown at the door of the people after the global pandemic.
“People who were living in rented accommodation faced many difficulties and they realized the importance of having their own home. Then we have the NRIs, who after witnessing the tough times abroad, are coming forward to buy a property in India that can help them have security in case of emergencies. Post-COVID, people are more concerned about the real estate asset and are ready to pay extra if the property fulfils their set of requirements,” says Amit Jain, MD, Mahagun Group.
COVID has been a tipping point that has resulted in faster technological adoption for source of information. Property seekers are preferring Online Ads (30.7%), Online Property Shows (28.3%) and Listing websites (32.2%).