Covid-19 is affecting many people worldwide and claiming the lives of people as well. The outbreak of creating uncertainty in our lives, and when it comes to the Indian context, the impact of the covid-19 outbreak is proving to be devastating.
The national GDP is also catching the negative figures, and the country is facing some huge losses in the economic recession. The real estate Sector is devastated in the three-month-long nationwide lockdown. Such circumstances have brought an end to the construction activities as well as the home service. New property sales are suffering due to the great prevalence of nations struggling to battle with the pandemic. The real estate demand is changing the behavior of home buyers.
India has started importing construction materials from China like Iron and Steel products, electronic equipment, technical construction equipment, plastic and fiber elements, along with solar panels. A recent central report suggests that the companies are also updating post the outbreak and completing the postponed projects. The companies are offering flexible work practices like work from home.
Have a look at the impact on different points.
The coronavirus spread has started delaying the recovery that is also reducing the GDP growth perspective. The center in the past had announced higher tax breaks as well as a lower interest on the home loans for making the Purchase. It is more lucrative. Demand slowdown in the residential segment is also cutting the house Hills project launches upright growth in the residential realities sector. The situation is such that the expecting delays in the project competition as well as extending support to the Builder community is still unpredictable. The government has started saying developers can get the project extended by six months.
Low-interest rates, as well as high tax exemption for developing the projects, are bringing change in consumer behavior. That said, the coronavirus outbreak is holding delay in every sector and is now disrupting all the growth. Since February, the Slow Down proves to be Apparent, and the site visits are also proving to be non-existent. The RBI is now announcing several red cards that are bringing the repo rate down to 4%. The step is appropriate to the major support for the existing buyers struggling to pay the EMI's in the short term or the middle term. A recent survey is responding that people are planning to buy the property on hold only for six months while also planning to return to the market right after that.
Previously, the slump hit builders for always being there. Government support for shading the increasing unsold stock even during the ongoing crisis is evident. The highlight is on the non-Banking Finance sector of the country. Now, several measures have been announced by the government in terms of the coronavirus specific stimulus package. There are EMI holidays for the developers that are proving to be a certain kind of relief to the Builder community. Besides, job uncertainty, property prices, and economic situation are leading to problems as well.
Remote working is continuing a schematic view of functioning for the companies. As for now, they are the infections that are drastically increasing, and the companies worldwide are bound to announce the remote working for the employees. It can cut the developers in this segment from working on office spaces further. They have always remained optimistic because they have got better access to even the low risk of defaults and liquidity. According to certain expert findings, the Pre covid-19 growth Momentum is going to get restored in January.
According to certain reports by the Global property brokerage Knight Frank, the total private equity investment of around USD 2.31 billion in the nine months of 2020 is giving the office Sector claimed 81% share. Besides, warehousing is around 10%, and residential is 9%. The gross office space absorption had touched the historic USD 63.5 million square feet in 2019. The office space improvement across the several leading cities is going to get 60 million square feet by the end of 2020.
The expectation was that around 54 malls would be launched in India in 2020. These predictions were made before the coronavirus. Now the anxiety surrounding virus spread also results in footfall in India's malls reducing to half. The situation was normal before the government started ordering the complete lockdown. It will also bring a fundamental shift in how the mall owners are going to look at their properties. The impact of the covid-19 in the power shutdown of the retail outlets as well as malls is inevitable.
Overall, the covid-19 is going to prove that the visit to the site is going to drop while also impacting the sales. Numbers the project deadlines are going to extend while pushing completion for others. The overall cost of the project is going to increase with the delays and supply constant. Inventory levels are going to increase while intensifying the pressure on the builder. The prices are going to move slightly awkward despite the score demand.
There are home loan interest rates that will fall after the repo rate is cut by around 40%. Remote working is going to gain traction in the future when the businesses are going to emphasize work from home culture. Documentary levels in the officers will decline shortly because remote working is going to be the future.
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