Anarock Property Consultants conducted a survey – Real Estate Consumer Outlook: H1 2019 – to understand what property seekers are thinking and whether the current macroeconomic environment is conducive for them to take the plunge in the property market or not.
Besides analysing the future trends based on buyer’s preference, the report also delves deeper into the past behaviour of property buyers from the demand and supply perspective.
The survey invited response via online multi-channels, in which 2,797 participants responded. Of the survey sample, 73% participants ranged between 25-45 years of age.
In a stark revelation, at least 48% buyers state that if given a chance they will not buy a property from the same developer. This resentment was largely seen in Delhi-NCR where nearly 68% said they will not buy a property again from the same developer. Hence, developers will need to re-strategize and align with buyer expectations rather than making tall promises early on and later faltering on them.
‘Conducive reformatory environment and the government sops in the recent budget have given a new lease of life to the Indian real estate with long-term investors coming back to invest in the sector. Unlike speculators, these investors have realistic expectations – similar to those in mature markets. While 58% of property buyers bought it for end-use, a good 42% ended investing in real estate, up by 10% against the previous survey.
Even while real estate across cities remained unaffordable for many, at least 50% participants bought a property because they felt that they got a good deal from their respective builder. In a significant development, a compromise on the overall size of the property was also no deterrent for most buyers as builders reduced property sizes to fit their product into the affordability bracket.
Much to the buyers delight, builders are now consciously launching projects in the affordable and mid segments over the last five years in order to bridge the demand-supply gap. Data indicates that the share of new supply in affordable and mid segment combined (within INR 80 lakh) was a whopping 77% during the period, with 39% in affordable and 37% in mid segment.
Even while ready-to-move-in homes is the preferred choice for several buyers, new launches – which took a major hit in the previous survey – saw a decent revival. More than 18% respondents now prefer to buy new launch properties as against mere 5% in the previous survey. Interestingly, 44% NRIs would consider new launch properties as against under construction or ready homes.
Low property prices coupled with improved infrastructure facilities in Tier 2 & 3 cities are attracting maximum investors to plan their investment in these cities. As per ANAROCK consumer sentiment survey, overall Tier 2 & 3 cities are the first choice amongst property seekers with 26% votes in favour of it, followed by Bangalore which emerged as the second most preferred destination for investment with 21% votes.
The stage seems set for Indian real estate to flourish in the long-term. That said, there were short-term repercussions with new supply and housing sales declining during the five-year-period by 64% and 28% respectively as per the report. This trend signified that builders became cautious while launching a product and were diligently trying to bridge the demand- supply mismatch.
Like in the previous survey, affordable housing continued to dominate both demand and supply and small compact homes garnered maximum buyer interest.
