Moneycontrol PRO
Contest Alert:1 day left to win Amazon vouchers worth Rs 5000. Take the MCPRO Quiz today to grab yours!

Housing prices to firm up in 12-18 months, says Motilal Oswal study

Over the long term, 20-25 players are likely to dominate the market versus the current developer count of 400-500, it said

It was perhaps the bottom of the U-curve for housing prices in India and, the only direction was up. After six-seven years of steady decline, the property prices have started showing some improvements.

While developers will watch out for the trend in inventory position, a supply crunch will mean that the prices would  inch up, says an analysis by Motilal Oswal. Over the next four to five  years, it is expected that the prices will be 1.3-1.4 times the current levels, or 4-5 percent on a CAGR basis, it  said.

The key takeaway from the study was that the residential sector is finally seeing positive sentiment with respect to a revival in demand after a prolonged hiatus, and that the momentum is here to stay.

Prices have hit rockbottom and are expected to pick up gradually in the near term as demand would slowly outgrow supplies, said the study.

The demand momentum for housing has picked up over the last two months, continuing from where it left before the second COVID wave, and has absorbed a large part of the completed and near-complete inventory across markets.

Close

COVID-19 Vaccine

Frequently Asked Questions

View more
How does a vaccine work?

A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.

How many types of vaccines are there?

There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.

What does it take to develop a vaccine of this kind?

Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.

View more
Show

Consumers have realised the importance of home ownership and upgrade demand, backed by strong IT hiring and salary revisions, it said.

The demand-supply balance will ensure the recovery has more legs. Further, infrastructure development is leading to incremental habitable locations in urban centeres, making sure that demand for housing is here to stay, it said.

Consolidation is expected to benefit large public and private organised players, the analysis said. Stronger players, who could sustain the cash crunch, have survived, while a sizeable chunk of players has exited the sector.

Over the next 6-12 months, supply will continue to be restricted to large listed and private players. Big bang expansions are expected only from these players, while smaller players will consolidate, it said.

Over the long term, 20-25 players are likely to dominate the market versus the current developer count of 400-500, it said.
Moneycontrol News
first published: Oct 19, 2021 02:21 pm

stay updated

Get Daily News on your Browser
Sections
ISO 27001 - BSI Assurance Mark