Coronavirus’19 has made immense ruination across the world that leads to high fraternity rate. Most of the firms have been affected economically. The real estate market has been eroded with loss of economic condition due to the COVID-19 pandemic and lockdown.
The Real Estate business is a highly growing business everywhere. But when COVID-19 pandemic and lockdown came in, the business has been devastated. Both the residential and commercial real estate have been hit hardly that lowered the sales and prices showed by Knight Frank Indian survey.
Ongoing projects and the new projects are terminated because of the construction halts and lack of labours. So the residential sector is in a weak position in growing. This is because of the migrant workers left cities and ceasing of construction materials supplies.
On considering the new supplies for constructions across major real estate markets across the country, around 42 per cent of the respondents believe that there will a worst phases will happen in the next six months.
According to the global professional services firm KPMG (Klynveld Peat Marwick Goerdeler), the residential sector has reported that the sales have come down drastically from four lakh units(2019-2020) to 2.8 lakhs to 3 lakhs units(2020-2021) across seven cities in India.
Shishir Bhaijal from CMD, Knight Frank India said, ‘The crisis had retracted the end-user confidence to its lowest levels ever, which will push any kind of real estate purchase decisions to the distant future. The already ailing real estate sector has been crippled with this pandemic, making it imperative for government support to bring it back on track’.
Niranjam Hiranandani the National President of NARECDCO said, ‘There will be a slowdown across the industry post-COVID-19 crisis. The industry is facing an acute working capital crisis which is essential to restart the business and keep it moving. We have all pinned our hopes on government intervention to salvage. The loss created by the crisis with its big fat fiscal stimulus to get the growth trajectory back on track’.
“As gradual recovery begins with improvement on this pandemic and things settle over a 12-24 month time horizon, we will see a long drawn extended U-shaped recovery for the residential segment but a faster V-shaped recovery for the office segment in the country. Sentiments perhaps may return earlier,” said Sanjay Dutt, MD & CEO of Tata Realty & Infrastructure.
Henceforth, the top developers of the residential sector said there will be a sign of price rationalization in Delhi NCR, Bengaluru, Chennai and Kolkata, the construction activities too are expected to resume gradually nationwide and they are open to dispute extra rent-free period in cases of new deals.