Housing demand to rise during festive season – let’s find out!

As we all eagerly await Diwali season this year to kick-off property buying and the festivities that follow, real estate industry is gearing up early this year. With the recent report by ANAROCK, it appears that there could be more demand than supply of residential units over the festive period in most cities across India. Real estate market is expected to gain momentum post Diwali with festive rush of buyers and new project launches.

Property prices have been on an upward curve in the near term and a surge in interest rates is likely to accelerate that trend. Despite the rise in property prices, housing sales continue to remain strong across major cities. This trend may continue in the upcoming festive season as well, because:

·?????Indians are turning more and more to home ownership as a secured investment and safeguarding against the economic impact of the COVID-19 pandemic. The number of first-time buyers continues to grow, and shown that 76% of would-be homebuyers surveyed for the study believe home equity debt is a good investment.

·?????The RBI has raised the repo rate almost by 0.50-0.75 bps since June 2017 and has logged five hikes this year. Two of these occurred in August, with a 50 basis-point hike each thereafter. Over 2018, interest rates have hovered at 5-6.5% level on average as compared to 3.3-4% during 2009, but still remain below their levels during the 2008 global financial crisis, when the hike went at 12% and above.

·?????The market today is characterised by a sharp increase in projects being launched by listed and large developers. The resulting increase in demand for residential units has attracted several new buyers and investors to the market – which is contributing to the robust sales performance of the branded players.

·?????The ready-to-move-in inventory is the most important driver of home sales and demand. In view of the increasing demand for homes, the inventory levels are expected to witness an increase during this festive season. The results hint at a favorable market sentiment and may further push sales.

·?????The housing market is poised to remain strong, we should see a continuation of the sales momentum that has been there since second quarter of 2021. The top developers are likely to roll out attractive offers for buyers right now to capitalize on the festive season coming up in October, 2022.?

Amid rising prices of construction materials, developers and realtors remain hopeful that the festive season would push housing demand further. In view of the above facts, we expect an average 5-10% rise in prices across the top eight cities during Q2 2022.

The time is right and make your first move, happy home buying this festive season.

[The author of this article is a senior Real Estate evangelist and runs multiple ventures specialising in Real Estate Marketing, Strategy, Funding, Sales, Digital Communication & Content. He has many successful ventures to his credit such as Brandniti a advertising and media agency, Regenti Infotech a web and tech development company, Ishtaan; an expert advisory for new real estate project development, funding and launches. His next flagship startup is Blume Proptech, leveraging Web 3.0 technology to build India’s biggest asset fractional ownership marketplace for retail investors . One may contact him at?[email protected] or [email protected]?for any query or discussion]?