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Corona to severely impact housing and office sales Steel Insights Bureau
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urrent estimates reveal a substantial drop in demand and supply across various real estate segments in 2020 in the wake of the corona pandemic. Housing sales could witness a 25-35 percent yearly drop in 2020 against the preceding year, reveals a report by Anarock Property Consultants. Residential sales in 2019 stood at about 2.61 lakh units across top 7 cities and may now fall between 1.70 lakh - 1.96 lakh units. Likewise, new launches may also witness a 25-30 percent decline during the same period – from 2.37 lakh units in 2019 to anywhere between 1.66 lakh -1.78 lakh units, the report revealed. Key findings
♦♦ Housing sales to see 25-35 percent y-o-y fall in 2020; new launches by 25-30 percent ♦♦ Unsold housing inventory to remain
20 Steel Insights, April 2020
stable, may even see 1-3 percent yearly reduction ♦♦ Construction delays could run into several months for well-funded projects, few years for others; 4.66 lakh units to be previously completed by 2020-end face high risk of delays ♦♦ Affordable housing target group most affected, limited income & unemployment fears to defer purchase decisions ♦♦ Indian office sector to see significant impact by Covid-19; besides demandsupply decline, key occupiers to re-look office space requirements ♦♦ Indian retail leasing and new mall completions to see 30-50 percent dip against previous growth estimates; revenue-sharing model to gain dominance ♦♦ Technology to gain significant precedence in Indian real estate from 2020 onwards
“Given the high chance of USA economy suffering due to Covid-19 impact, its negative effect will be felt in India with a drop in office space leasing”
Anarock Research
Unsold inventory in 2020 will largely remain stable, with single-digit annual decline of around 1-3 percent. The nationwide lockdown has completely halted construction activity - project delays could run into several months for well-funded projects, and a couple of years for others. Nearly 4.66 lakh units across the top 7 cities earlier slated for completion in 2020 now face a high risk of delays. The affordable housing segment, which gained significant traction over the last few years, may also take a hit by Covid-19. The outbreak will significantly affect affordable housing’s target audience. With limited income
