70% of prospective buyers prefer properties under INR 80 lakh
While ready-to-move-in homes remained the preferred choice for several homebuyers, new launches (which drew the least consumer interest in the previous survey) saw a decent revival according to ANAROCK’s Consumer Sentiment Survey H1 2019. Over 18% of respondents now prefer new launch properties as against mere 5% in the previous survey.
Interestingly, 44% NRIs would now consider new launch properties over under-construction (to be completed in 1 year) or ready-to-move-in homes (obviously a welcome development for developers facing funding issues due to previously negligible advance sales).
RERA implementation and lower GST rates immensely helped revive consumer faith in new launch properties. More than attractive prices, effective RERA enforcement influenced over 50% buyers in Delhi-NCR to take the real estate plunge in 2018. In Kolkata, nearly 58% of buyers took the plunge due to lower home loan rates.
Anuj Puri, Chairman, ANAROCK Property Consultants says, “Our latest survey confirms that a conducive reform-driven market environment and Government sops have breathed life to Indian real estate. Long-term investors with realistic returns expectations are returning. 58% of our respondents bought property for end-use, and 42% bought for investment – up by 10% against the previous survey.”
“Tier 2 & 3 cities have emerged as the new investment hotspots thanks to low property prices and improved infrastructure boosting their overall growth potential,” says Puri. “Our survey confirms a 26% investor approval rating for tier 2 & 3 cities, with Bangalore following as the second-most preferred investment option with 21% votes.”
53% of respondents buying property for investment are focused on rental income
The recent budget offered major benefits to property investors, such as increased TDS threshold on rental income from INR 1.8 lakh to INR 2.4 lakh and the benefit of rolling capital gains tax from investment in one house over to two new houses. Property investment with a focus on rental income is once again being seen as lucrative.
A majority of 41% of respondents preferred to buy property within the city limits, close to offices, schools, etc. However, 38% found the steep prices in city centres or even within city limits unattractive and are willing to consider suburban areas.
This trend was most obvious in relation to expensive cities like NCR and MMR. Also, affordable housing project launches and improved infrastructure facilities in suburban areas are helping both homeownership and investor sentiment for the suburbs.
