VIJAYAWADA: The Covid-19 pandemic left a telling effect on various sectors and real estate is one of them. However, those in the industry say the impact is not as bad as the 2008 recession’s. “It only created a pause, and did not derail any project. We look forward to advancing those projects in 2021 and are hopeful to have a fruitful year ahead,” said KSC Bose, general secretary, Confederation of Real Estate Developers’ Associations of India (CREDAI), AP Chapter.
“Covid-19 crisis has brought a change in the way consumers think. They are reverting to the Indian way of thinking —save some for a crisis so as not to get caught off guard. Demand has not decreased and those investing in properties are now adopting a more cautious approach. With the increasing trend of nuclear families, the demand for housing is expected to increase manifolds in the coming years,” he told TNIE.
The health crisis has had different impact in different cities of the state. Though there was temporary halt in the initial months of Covid-19, the construction activity picked up in Visakhapatnam and Tirupati later. However, the same was not the case in Amaravati region, more for political issues than the pandemic.
“Due to politically-induced uncertainty, there has been a drop in land value by 50-60 per cent in Amaravati. In 2018-19, a square feet area was around Rs 6,000, which has since reduced to Rs 4,000, and in spite of that there are only a few takers. According to valuation experts, the projects which were valued at Rs 100 crore in 2018 have come down to Rs 40 crore in 2020. The situation also affected prospects in Vijayawada and Guntur. However, as no new projects were taken up in the last 18 months we expect a quick recovery.”
According to another realtor, who has been in the business for more than two decades, unsold inventory in Vijayawada and Guntur is expected to get cleared in 2021-22. “The situation is not as bad as in 2008, and the investors will get back their investment value, sooner or later.”
According to a recent survey, the infra boom in India is expected to continue till 2030, and not just in the housing, but even in other aspects of infrastructure as well. Bose was of the opinion that more and more young people are preferring to own a house as soon as they are settled in their professions. “They view a house as not just an investment, but also a security for their later years.”
“Concessions like decreased stamp duty, allowing payment of approvals fees in installments, exemption from RERA to builders with less than 20 units, decreased GST will aid in recovery of real estate sector,” opined another realtor.
Land value in Amaravati reduces by half
According to a recent survey, the infra boom in India is expected to continue till 2030
Construction activity has picked up in Visakhapatnam and Tirupati. However, the same is not the case in Amaravati region, more for political issues than the pandemic. Land value in the capital region has seen a fall of 50-60 per cent