Mid-range homes flavour of the season: Survey

Affordable budget segment (homes below Rs 45 lakh), the most preferred budget category in the H2 2018, has taken a backseat this year (31 percent).

Pune and Chennai homebuyers are still inclined towards affordable budget category as their first choice with 52 percent and 51 percent votes, respectively. Collectively, these two segments (affordable and mid segment) account for a massive 73% of the buyer's demand in H2 2019 survey results.

This year homebuyers favoured properties within the sub Rs 90 lakh budget.

The share of consumers preferring the ultra-luxury category (above Rs 1.5 crore budget range) continues to fall and stands at 9 percent, which is down 4% against H2 2018 results.

2BHK most preferred segment Small continues to be big in India’s residential market. 2BHK again secured first spot as the most preferred BHK-type in H2 2019 survey. About 52 percent of the respondents voted in favour of 2BHK unit-configurations but its share preference saw an annual decline of 5 percent from 57 percent in H2 2018 survey. On the other hand, nearly 31 percent indicated preference to buy 3BHK homes while 15 percent preferred 1BHK homes. Merely 2 percent iof respondents showed interest in 4BHK homes.

Gold, stock or real estate?

As many as 59 percent of the respondents preferred real estate over other asset classes like stock market, FDs and gold.

Also, property prices are at their lowest best across most cities and with government announcing a slew of measures favouring the sector, both investors and buyers are hoping for steady growth in the future.

Alternately, stock market maintains its status as the second-most preferred asset class for investments. City-wise, Pune saw maximum respondents (over 72%) preferring real estate. They consider it to be the safest asset class for investment in the present scenario. Also, the city has emerged as an affordable hotspot in 2019 with majority new launches in the budgeted segment priced

Regulatory changes such as RERA, AIF helped repose confidence

An overwhelming 72 percent of the survey respondents believed that the various government measures coupled with recent court rulings in favour of homebuyers has helped them to increase their confidence to invest in real estate. Merely 13 percent believed that the measures taken by the court or the government in recent past are still not enough to rekindle their faith in investing in real estate.

To boost confidence of prospective homebuyers, the government last year announced the creation an alternate investment fund (AIF) of Rs 25,000 crore for last-mile funding of stuck realty projects, an issue that jolted the confidence of homebuyers.

Who is buying?

As many as 60 percent of the respondents in NCR are looking to buy a property within the next six months. In stark contrast, merely 24 percent respondents in Kolkata and 26 percent in Bengaluru are looking to buy a property within the next six months.

Pune seems another lucrative market for many property aspirants as nearly 58 percent seekers within the city hope to take the plunge over the next six months, followed by Hyderabad with 47 percent seekers and Mumbai-MMR with 42 percent aspirants.

NRIs are also very keen to invest in a property in India over the next six months as nearly 69 percent of them are willing to seal-the-deal as compared to last year’s 65 percent.

Analysis of city-specific trends indicates that maximum respondents from smaller cities (34 percent), followed by Chennai (30 percent), Bengaluru (29 percent) and Kolkata (27 percent) are holding on to their decision of property buying until the next one year.

Of the 67 percent of respondents who plan to buy property for end use, most (76%) respondents are first-time home buyers. However, 34 percent are also looking to upgrade their current accommodation.

Connectivity most important while selecting property

When it comes to zeroing in on a residential project, connectivity features high on any homebuyer’s 'look out' list. It’s no surprise that (43 percent) marked connectivity to workplace as the top priority while finalising a home. Interestingly, in established IT hubs such as Pune (58 percent) and Bengaluru (55%) where residential real estate has developed around IT-ITeS establishments, connectivity is the first priority while buying a house.

As many as 32% of the respondents marked amenities on offer as the second most important factor while buying a home.

Buyers in Kolkata (41 percent), Chennai (39 percent) and Hyderabad (38 percent) were the top cities where respondents place a high premium on the largest property they can afford

Ready-to-move in homes preferred

Delhi-NCR (44 percent) has once again emerged as the top city with a high demand for ready-to-move in properties, followed by Pune (42 percent) and Tier 2 & 3 cities (42 percent). However, properties which are in advanced stage of construction are also emerging as safe options for both end-users and investors. 24% of respondents preferred to buy properties which will be ready within 6 months, followed by 19 percent voting in favour of properties which will be ready within a year, the survey said.

Only 13 percent respondents in the current survey marked 'saving GST' as the major reason to choose ready-to-movein property over under-construction as against 30 percent respondents in the H1 2019 survey.