Amid escalating housing prices and increasing home loan rates over the past year, prospective homebuyers are seeking tax incentives and flexible payment plans. They are also inclined towards additional perks offered by developers, according to a survey conducted by Housing.com, a leading PropTech company, in collaboration with real estate industry body NAREDCO.
The demand for ready-to-move-in residential properties outstrips that for under-construction projects. Housing.com and NAREDCO released their latest survey report, "Residential Realty Consumer Sentiment Outlook H2 2023 – Trends and Insights,". The online survey engaged over a thousand potential homebuyers and was conducted between January and June 2023.
According to the survey, 48% of respondents favour real estate investment, significantly outperforming other asset classes such as stocks, fixed deposits, and gold. The data indicates that 18% prefer the stock market, 19% opt for fixed deposits, and 15% choose gold.
Mr. Dhruv Agarwala, Group CEO of Housing.com, PropTiger.com & Makaan.com, commented, "Throughout history, real estate has been a cornerstone of investment. The COVID-19 pandemic has enhanced its relevance, making it the preferred choice for many. Factors such as the emphasis on homeownership, the rise of hybrid work models, and the importance of safety and security have elevated the real estate sector to new heights."
Mr. Rajan Bandelkar, President of NAREDCO, observed, "The recent G20 summit will positively influence the overall economy and could reshape India's real estate through policy, investment, and sustainability considerations. The increasing consumer confidence surpasses the lows experienced during the pandemic’s peak. Though income outlooks have slightly declined, real estate continues to be the asset class of choice for 48% of respondents."
Mr. Bandelkar further added, "Due to escalating property prices and interest rates, incentives like stamp duty and GST waivers are key influencers for home purchases in the near future. These incentives aim to make homeownership more appealing and accessible. The survey highlights the value of personalized support following property shortlisting, which is critical for closing deals and enhancing the overall homebuying experience."
Tax incentives, such as stamp duty and GST waivers, along with flexible payment plans, are identified as the primary motivators for homebuying in the upcoming six months, according to the report.
"In recent years, we've seen a noticeable uptick in housing prices, reversing nearly a decade of stagnation. Despite a 2.5% increase in home loan interest rates this year, the real estate market has shown resilience. This robustness can be attributed to both pent-up and emerging demand," elaborated Mr. Agarwala.
Ms. Ankita Sood, Head of Research, Housing.com, PropTiger.com & Makaan.com said, “Driven by strong domestic demand, India’s economy is expected to grow at the highest rate among major economies. This buoyancy in consumer demand is visible in the property market as-well, where despite weak external cues, sales in the primary market registered a 15% yearly uptick in the first half of 2023. Capturing the market confidence, our realty consumer survey, a leading indicator to gauge consumer sentiments highlights the homebuyer confidence in both the economy and their future earnings, factors pivotal for a high value purchase as property. To add to this, preference to invest in real estate continues to reign above all other forms of investment avenues exhibiting strong market fundamentals.”
Ms. Sood, further emphasised “Looking ahead, the homebuyer sentiments regards the property market is expected to remain in the optimistic zone. Although, one has to be mindful of the on-going geo-political conflicts which may have a bearing on demand across sectors.”
