In this time of adversity, we as humans tend to assume that along with keeping our family and community safe, we must also be safe with our investments. However, in this unprecedented change in social, business, health and other interactions there is a new normal for financial decisions. Due to halts in business and a slow-down of consumer movement, we would assume that the real estate industry has suffered dramatically. Conversely, even with business continuity being uncertain, consumers still prefer to invest in real estate, especially in the Bengaluru area.
Why is this becoming an opportunity of investment and how is the real estate atmosphere becoming a more lucrative decision? Right now the pandemic has caused job losses, reduced incomes and made business continuity uncertain so investors are seeking options for safety and wealth preservation. Currently the environment has made it so that owning a house has been more important than ever. Not only is it an unparralled source of financial stability, but it is a requirement for families, and those who need more space for home offices as the lockdown could be extended.
Why now is the right time to invest in Real Estate?
All time low EMIs:
Private and Public banks, according to outlookindia.com* (Mr. Jindal) such as SBI, Kotak Mahindra, HDFC, has slashed housing loan interest rates to record low levels. For lenders this is a risk-free bet as it involves the collateral of the house, in addition lenders borrowing rate from RBI has also decreased. This is a proven way, especially in the middle class consumer demographic, to increase consumer confidence and boost purchasing power. Having these level of EMIs can be a decision making factor for the consumer.
Time at our disposal:
The biggest fraction of home buyers are Millennials and they conduct most of their property research from their mobiles. They have time to narrow their options and know exactly what they are looking for in a home. Since there is more time now to research and make a wise decision, the customer satisfaction will be longer assuring a longer relationship with the builder. This ample research time for all home buyers will not only help them evaluate a better price to performance option, but pick the right project according to the lifestyle and patterns of their families. The decision making time will be quicker after enquiry as they have narrowed down their option, builder, brands, and prices.
Pandemic Sale:
The property prices for both residential and commercial properties are much lower in Tier 2 & 3 cities as well as Tier 1. Industry experts are saying “if you are an aspiring home buyer in India, nows the best time to buy your home.” Real Estate brands have been giving more than 5% discounts. Because of constant demand and prime location, Indian real estate brands have very rarely offered such discounts. Due to the post-pandemic situation, according to Economic Times*, Bangalore alone has witnessed a 19% on-year growth in housing sales and unsold stock decreased by 11%.
High returns (ROI) & Locality:
Bangalore’s transformation in the coming years has been noted globally as Indias Silicon Valley and a leading metropolitan city in India. North Bengaluru especially has witnessed tremendous infrastructural growth such as an immediate response to the pandemic, providing aid, apartments offering integrated ammenities to push Work From Home, creating connectivity through public transportation and private companies such as Dunzo, Swiggy, Zomato, and many others to help with basic necessities. This is an opportunity for real-estate investment by investors, and homebuyers alike as builders are taking the time to research in-depth the buyers needs and integrate those requirements in their projects. There is a pan interest in these parts of North Bengaluru – Hebbal, Yelahanka, Hennur Road, and Devanahalli. Most homebuyers looking for 2-4 BHK millennial home flats with a unique floor plan and/or luxury space apartments to open up for home offices.
Capitalize on a developing area and homeowners can enjoy fast appreciation rates. According to JLL, Bengaluru continues to be the preferred hub for commercial real estate, Q1 this year saw an absorption of 1.9 million sq. ft. for tech giants, pharmaceuticals, R&D start-ups. Even in this situation, there is still ample career opportunities and an influx of IT professionals moving to the North Bengaluru area for a soaring rate of other well-established industries. These decisions, in the safety of your homes, such as investing in this prime locality while locking into the potential of appreciation, can be a huge opportunity for wealth creation.
In conclusion, even though this worldwide pandemic has been overwhelming, don’t give up, at least take the time to make big long term decisions which can bring returns in the coming days. Due to the limited inventory and new launches shelved, this is the best time to invest before prices go up for under construction projects. The real estate industry has created positive, creative investment strategies along with the help of government policies, this is not a bad time to sit and research on where to put your savings.
Last but not least, we advice you to take safety precautions extremely seriously, get vaccinated, and try our best to slow the spread.