India’s real estate industry suffered from various setbacks in recent years, due to the sudden demonetisation, implementation of GST and the introduction of RERA. The hopes of a recovery in 2020 were thwarted due to the coronavirus pandemic. Moreover, the financial restrictions imposed by the lockdown made the demand for homes plunge sharply.
However, the unlock phase saw a robust recovery of the residential sector in real estate. 2021 is expected to be a year of a partial recovery in real estate. According to a study, the home loan EMIs have become more affordable, as incomes have been steadily increasing and now the gap between income and EMIs is just 25%, as opposed to the previous 50%.
As a result, buyer sentiment has been improving, and 2021 presents a great opportunity for becoming a homeowner. Here are some of the major things you can expect in the post-COVID year.
Rise in demand due to low interest rates
In an effort to kick start demand, the RBI has reduced repo rate to 4%. Not only this, but the home loan interest rates are at an all-time low, with the average being around 7%. This will undoubtedly appreciate the demand for housing in real estate in 2021. Moreover, it is just the nudge that fence sitters needed to get back to house hunting.
Festive season euphoria to continue
Financial analysts are calling the slump caused by the COVID-19 pandemic a mere blip in the market, as the real estate sector saw a huge rise in the festive period of 2020, from October-November. Low interest rates coupled with festive offers got the ball rolling. Forecasters predict that this euphoria will continue in 2021 and drive most of the real estate investments, at least until the first quarter of the year.
State-wise incentives
Cheaper home loans are certainly a driver for growth, but some respite has to come from the supply side as well, to appeal to the fence sitters. The Maharashtra government reduced stamp duty prices due to which property prices are also expected to go down. Following its footsteps, the Karnataka government has also done the same for houses priced between Rs. 20-35 lakhs.
Pent-up demand
The unforeseen challenges brought about by the pandemic suppressed demand, but since the vaccine is getting rolled out in India soon, the pent-up demand will also play a major role in increasing real estate investments. 2021 presents a favourable outlook for homebuyers in the form of cheaper housing finance and relatively relaxed home loan eligibility criteria.
To sum up, 2021 might be the best time to purchase a house in the recovering economy. Some of the major Indian cities have also witnessed price correction. Therefore, if you are looking to avail of housing finance, use the online mode to browse for favourable loans and schemes.
You can
also make use of an online home loan EMI calculator to pre-calculate your EMI.