Register for features like favorites, compare, comprehensive advice, consultation and more.Register
A major blow for the real estate sector due to the outbreak of coronavirus was the halting of construction activities. As the lockdown was imposed, almost every industry, including the developers, had to stop their activities in order to maintain social distancing and other safety measures. Now with the curbs being lifted gradually, the government has permitted the resumption of construction with necessary precautions. However, the real estate industry still faces a number of challenges.
The most prominent problem for the developers now is the lack of manpower and raw materials. A major section of the workforce consists of migrant labour, many of whom have now returned to their native homes. Without enough workers, only the developers who managed to retain their workers would be able to resume construction activities in full swing. Moreover, with imports disrupted, a shortage of raw materials such as cement, iron and steel, etc. has emerged. As a result, their prices would skyrocket, thus increasing the construction costs for the developers.
Another challenge for the developers is maintaining the safety of the workers. The construction areas would need to be properly sanitised and the workers have to undergo health check-ups. The developers would also have to provide the workers with equipment such as masks, gloves, goggles, sanitisers, coveralls, etc. This would amount to extra expenses for the developers. Moreover, the workers would be wary of the pandemic and take care of their own hygiene all the time. This might reduce their productivity.
However, the silver lining for the developers is that the outbreak has made people realise the importance of having their own place of residence instead of rented accommodations. One’s home being the only safe place, a rising wave of home purchases is expected. Additionally, more homebuyers would now go for modern residential units which come equipped with a throng of amenities to allow them to work from home.
Demand for homes is also expected to grow among investors as they are starting to shift from commercial properties to residential ones. As a result of the pandemic, malls, offices, shops and other commercial spaces are closed. Naturally, this would lead to hampered revenue for the investors, who are now going to switch to the residential sector as homes are an essential necessity and would still attract tenants.
Investors who used to invest in stock markets are also beginning to switch their focus & are starting to put their money in Real Estate. The COVID-19 crisis, which caused stock markets to crash, has borne out real estate investments as a risk-free proposition. It can thus be said that the overall scenario in the realty sector is mixed, characterized by both challenges and advantages in the market as well.
Stay updated with everything real estate!
Subscribe to our news letter